One-glance verdict
Within fair range
$116.73 our estimate vs market $84.70
Wall Street consensus: $125.00 (7.1% higher than our fair-value estimate)
27% below our estimate
Fundamentals snapshot
Temenos AG
TMSNY · PNK · Technology · Software - Application
Current price
$84.70
52-week range
$74.88 - $107.27
Market cap
$5.70B
Balance sheet
Stretched
17.11x Strong cushion
Net debt $645.58M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 4.5% last year.
- Reward Returns 42.8% on equity, ahead of 80% of its peers.
- Reward Free cash flow was positive in 4/10 years.
- Risk Insider ownership is only 0.0% (peer median: 1.8%).
What this company does
Temenos AG
Temenos AG provides the essential software that powers banks, helping them manage everything from customer accounts to loans. The company makes most of its money by charging subscription fees, which creates a steady stream of recurring revenue (income that is expected to continue regularly). Because switching core banking software is incredibly difficult and expensive for a bank, Temenos tends to keep its customers for a long time.
How the company got here
Founded in Switzerland in 1993, Temenos started by acquiring a banking software platform called GLOBUS. A key moment was the 2003 launch of their new system, T24, which was a significant technological step forward and became a cornerstone of their offerings. The company went public on the Swiss stock exchange in 2001, which provided funds to grow and acquire other companies. Over the years, it has grown by expanding into new countries and buying other software companies to enhance its capabilities for different types of banking.
What it actually does
Think of Temenos as providing the digital backbone for banks and other financial institutions. When you use your bank's mobile app, apply for a loan online, or just check your account balance, there's a good chance Temenos software is working behind the scenes to make it all happen smoothly and securely. They provide the complex software that banks need to manage everything from customer accounts and transactions to complying with financial regulations. Essentially, they help banks modernize and compete in a world where customers expect fast, digital services.
Software Licensing
This is the company's main business, where banks pay to use Temenos's core software products. This is often a long-term commitment, and the bank pays an initial license fee and then recurring maintenance fees for updates and support. This segment includes their core banking platform, which manages a bank's essential operations, as well as software for digital banking, payments, and wealth management. This part of the business generates a steady and predictable stream of revenue (money coming in) from thousands of financial institutions worldwide.
SaaS and Subscription
Instead of buying the software outright, banks can pay a recurring subscription fee to access Temenos's products over the internet, a model known as Software-as-a-Service (SaaS). This is like subscribing to a streaming service instead of buying a DVD. This option is popular because it requires less upfront investment from the bank and Temenos handles the technical upkeep. This is a growing part of their business as more banks want the flexibility and lower initial costs of cloud-based software.
Services
Getting a new, complex software system to work correctly inside a bank is a major project. This business segment is where Temenos provides the expert help to get it done. They offer consulting to help banks plan the implementation, training for the bank's employees, and ongoing support to make sure everything runs smoothly. While smaller than their software licensing business, these services are crucial for ensuring their customers are successful with their products.
What management is betting on now
The company is heavily focused on its cloud-based and SaaS (Software-as-a-Service) offerings, betting that more banks will choose this flexible subscription model over buying software licenses outright. They are also investing in making their core banking products more modular, allowing large banks to upgrade their systems piece by piece rather than all at once. Another key priority is expanding their partnerships and continuing to innovate with technologies like Artificial Intelligence (AI) to make banking more efficient and personalized for their clients' customers.
Price history
How the share price has moved
—
Loading price history…
Is it cheap or expensive?
Fair value $116.73 vs current price $84.70
Wall Street consensus is the average analyst price target: $125.00 (7.1% higher than our fair-value estimate).
Our most-likely fair value is $116.73 a share — about 37.8% away from today's price of $84.70, so the stock currently looks fairly priced.
Is it drowning in debt?
Stretched
Net debt $645.6M. Interest coverage 17.1x.
Net debt
$645.58M
Interest coverage
17.11x
Temenos AG's profit covers its interest bill about 17.1 times over. which is stronger than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Stretched
Worse cushion
Baseline
Better cushion
TMSNY
BASELINE
Temenos AG
Total debt $842.18M Interest coverage 17.11x This is the baseline the peer rows are being compared against.
Total debt $21.26B Interest coverage 4.50x -74% vs TMSNY Carries about 3.8x less debt cushion than TMSNY.
Total debt $77.82M Interest coverage 117.88x +589% vs TMSNY Carries about 6.9x more debt cushion than TMSNY.
Total debt $7.78B Interest coverage 3.31x -81% vs TMSNY Carries about 5.2x less debt cushion than TMSNY.
Total debt $338.63M Interest coverage 0.21x -99% vs TMSNY Carries about 80.1x less debt cushion than TMSNY.
What you should know
The case for and against TMSNY
3 Rewards
1 Risk
Rewards
-
Revenue grew 4.5% last year.
-
Returns 42.8% on equity, ahead of 80% of its peers.
-
Free cash flow was positive in 4/10 years.
Risks
-
Insider ownership is only 0.0% (peer median: 1.8%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
29.51x
Forward P/E
16.35x
P/B
13.75x
P/S
5.15x
EV/EBITDA
21.25x
PEG ratio
3.02x
Profitability
How much profit each dollar creates
Gross margin
74.3%
Operating margin
32.2%
Net margin
17.5%
ROE
42.8%
ROA
7.5%
Health
Liquidity and balance-sheet strength
Debt / equity
2.26x
Current ratio
0.51x
Quick ratio
0.51x
Total debt
$842.18M
Total cash
$196.60M
Growth
How the business has been compounding
Revenue TTM
$1.11B
Revenue 5Y CAGR
4.7%
EPS TTM
2.87
EPS 5Y CAGR
36.0%
Cash flow
How much cash the business throws off
Operating CF TTM
$353.82M
Free CF TTM
$280.75M
FCF margin
25.3%
Dividend
Shareholder payout
Yield
2.1%
Payout ratio
61.6%
Last ex-div date
2026-05-19