The Descartes Systems Group

DSGX

Software - Application · Technology

Price

$74.16

-1.75 (-2.31%)

Market Cap

$6.35B

Exchange

NASDAQ

Winston Score

Winston is curious

A decent business — some strong pillars, some weaker.

Share count rising — dilution

+1.6% over 4y

The company has issued more shares over this period, which dilutes each existing shareholder’s stake.

Diluted shares outstanding: 86.2M (2022) → 87.6M (2026)

The Descartes Systems Group Inc. provides cloud-based logistics and supply chain management business process solutions that focuses on enhancing the productivity, performance, and security of logistics-intensive businesses worldwide. Its Logistics Technology platform offers a range of modular, cloud-based, and interoperable web and wireless logistics management applications, which unites a community of logistics-focused parties, allowing them to transact business. The company provides a suite of

Winston Score History

Politician Trades

3 trades / 12mo

1 Congressional buy and 2 sells on DSGX in the last 12 months.

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Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+17.2% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

+22.7% YoY

YoY Growth Rate

Steady EPS growth

R&D Spend

$108M/ year

↑ Rising (+13% vs prior year)

14.4% of revenue

In line with sector average (15%)

Investing heavily in future products and technology

Insider Activity

0.2%ownership

→ Flat

Insiders holding steady — not selling despite ability to

Cash Position

Cash flow positive

$354M cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Growth + cash flow

The Descartes Systems Group is a rare growth stock that's already generating positive cash flow while growing at 17%. The Winston Score doesn't fully credit this transition from "burner" to "earner."

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

66.7%

Premium pricing power — 66.7% gross margin

Operating Margin

33.7%

Excellent — 33.7% operating margin

ROCE

4.1%

Weak — 4.1% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

+12.4%

Fast-growing sales (12.4% YoY)

EPS YoY

+18.4%

Earnings growing fast (18.4% YoY)

Healthy double-digit earnings growth — what compounders look like.

EPS Consistency

8/8 quarters

Every recent quarter grew earnings vs last year

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Cash Flow

Cash Conversion

166%

Turns 166% of profit into real cash

FCF Margin

36.8%

Converts sales into free cash efficiently (36.8%)

Free cash flow margin above 20%. Out of every $100 in sales, more than $20 is real cash they keep.

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Stability

Debt / Equity

0.00

Conservative — low debt load (0.00)

Interest Cover

228.36x

Comfortably covers interest (228.4x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

P/E Ratio (TTM)

38.4x

Pricey — P/E 38.4

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward

+10.6

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (38.4 → 27.8)

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Dividends

Not applicable for this business.

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