Quality Investor

SPS Commerce, Inc.

Rank #103Op. LeverageWatchlistCompare with other stocks

SPSC · Nasdaq · Technology

SPS Commerce, Inc. (SPSC) — Rank #103 by gross profitability (GP/assets 0.46) · ROE 9.9% · Piotroski F-Score 6 / 9.

As-of 2026-10-30 · CIK 0001092699 · all metrics point-in-time as of the filing date.

About

SPS Commerce, Inc. provides cloud-based supply chain management solutions in the United States.

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It offers solutions through SPS Commerce, a cloud-based platform that connects retailers, brands, distributors, manufacturers, and logistics providers, handling the complexity of modern commerce operations. The company also provides Fulfillment, a comprehensive solution designed to streamline supply chain operation that sends and receives order data, ensuring accurate execution of required processes from order to invoicing and revenue recovery through fully automated operations; and Analytics product that simplifies managing sell-through data from customers business partners that handle data acquisition, cleansing, normalization, and delivery. In addition, it offers various complimentary products, such as assortment product, which simplifies the communication of robust, accurate item data by automatically translating item attributes, and hierarchies through single connection across all sales channels; and relationship management product that allows organizations to accelerate digitization of their supply chain and improve collaboration with suppliers through change management, onboarding programs, and supplier score carding. The company was formerly known as St. Paul Software, Inc. and changed its name to SPS Commerce, Inc. in May 2001. SPS Commerce, Inc.

was incorporated in 1987 and is headquartered in Minneapolis, Minnesota.

Industry
Software - Application
Sector
Technology
Filer Category
Large accelerated filer
Fiscal Year End
December 31

Company Snapshot

P/E and reverse DCF are the primary valuation lenses at this stage.

Market Cap

—

P/E (annual)

—

P/S (annual)

—

P/B

—

P/OCF (annual)

—

Shareholder Yield

—

Employees

2,948

Industry

Software - Application

Exchange

Nasdaq

11/12

Flags passed

SPSC fails 1 critical flag

Passes 11 of 12 quality flags

  • FAIL
    Balance sheet deteriorating

    Net cash collapsed with receivables or inventory outpacing revenue

  • PASS
    Gross margin holding
  • PASS
    Dilution within 2%
  • PASS
    FCF not negative from investment
  • PASS
    Disclosure consistent
  • PASS
    Revenue not declining
  • PASS
    Operating margin holding
  • PASS
    Free cash flow intact
  • PASS
    Passes safety gate
  • PASS
    No competitive retreat
  • PASS
    SBC not compressing margin
  • PASS
    No valuation convergence

Strengths Operating leverage expanding · Deferred revenue growing · Sequential beat (rev + EPS)

A count of the 12 warning flags that could be evaluated. Unweighted: colour follows the worst flag.

Quality Profile

Profitability

1/1 pass
GP / assets
0.46
Return on equity
9.9%
Gross margin trend
PASS

Safety

1/1 pass
Balance-sheet safety
PASS
Debt / equity
0.20
Current ratio
2.26×
Net cash
$173.17M

Cash Flow

3/3 pass
Positive FCF
PASS
Cash-backed earnings
PASS
Accruals healthy
PASS
SBC / revenue
7.1%

Growth

2/2 pass
Revenue growth
17.8%
Piotroski F-Score
6 / 9
Share dilution
0.4%

Operating margin expansion and free cash flow are the primary reads at this stage.

Profitability

Does it make money well?

No warning flags · GP/assets 71st percentile of 36 SIC 7372 peers

Gross profitability (GP / assets)

0.46

Primary signal (Novy-Marx).

71st pctl of 36 SIC 7372 peers

Return on equity

9.9%

Gross margin

69.2%

46th pctl of 36 SIC 7372 peers

Revenue growth (YoY)

17.8%

Gross margin improving

Margin trend vs prior year.

PASS

Operating Leverage

2022202320242025
Revenue vs COGS
Revenue vs OpEx
Op. Income vs Revenue

Growth

Revenue CAGR (3Y)

18.6%

Revenue CAGR (5Y)

19.2%

Earnings CAGR (3Y)

19.2%

FCF CAGR (3Y)

23.8%

Cash Flow Health

Is the cash real?

No warning flags · FCF 63% above net income

Free cash flow

$152.27M

Operating cash flow minus capex.

Positive free cash flow

PASS

FCF vs net income

63.1%

(FCF − net income) ÷ |net income|. Positive: cash above earnings. Negative: below.

FCF not below net income

Fails when free cash flow is below net income (yellow flag).

PASS

Accruals healthy

Cash-backed earnings.

PASS

SBC / revenue

7.1%

Stock-based comp intensity.

Balance Sheet Strength

Can it survive a storm?

Warning: Balance sheet deteriorating · net cash $173.17M, F-Score 6/9

Balance-sheet safety

Composite anti-fragile check.

PASS

Debt / equity

0.20

87th pctl of 32 SIC 7372 peers (best = lowest)

Current ratio

2.26×

60th pctl of 36 SIC 7372 peers

Quick ratio

1.62×

Net cash

$173.17M

Cash & equivalents minus total debt.

Piotroski F-Score

6 / 9

Fundamental-strength score (0-9).

Valuation

Is the price reasonable?

No warning flags

Capital allocation quality

Composite score

2.0 / 5

Fair
Share count trend
0.4%2/5 Fair
Buyback timing
N/AN/A
Dividend growth consistency(non-payer or broken streak)
0 yr3/5 Good
Net debt trajectory
-7.7%1/5 Weak

Lifecycle Phase History

20202025
Op. Leverage
Hypergrowth

Price History

SPSC-43.4% · -10.7% CAGRSPY+82.9% · +12.8% CAGR