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Bentley Systems (BSY)
NASDAQ:BSY
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Bentley Systems
(NASDAQ:BSY)
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Rating:70Outperform
Price Target:
$41.00
▲(12.18% Upside)
Action:ReiteratedDate:02/27/26
The score is primarily supported by strong underlying financial quality (high margins and strong free-cash-flow generation) and a positive earnings call with solid 2026 growth, margin, and cash-flow guidance plus strong retention metrics. Offsetting these strengths are weaker technicals (still below longer-term moving averages with negative MACD) and a premium valuation (high P/E with a modest dividend yield).
Positive Factors
Recurring revenue & retention
A 92% subscription mix with $1.462B ARR, 99% retention and 109% net revenue retention creates a very sticky, predictable revenue base. This fosters durable cashflows, supports upsell within installed accounts, lowers acquisition reliance, and underpins multi-year ARR growth and margin leverage.
Robust free cash flow generation
Consistent, large FCF (rise to ~$520M and FCF closely tracking accounting earnings) provides durable internal funding for dividends, buybacks, debt paydown and selective M&A. Strong cash conversion reduces refinancing risk and enables strategic investment without overreliance on external capital.
High and improving margins
Very high gross margins (74%–82%) and expanding adjusted operating margins (~28.6% in 2025) reflect software economics and operating leverage. Durable margin expansion supports reinvestment and shareholder returns, and indicates structural profitability resilience across economic cycles.
Negative Factors
Elevated leverage
Leverage remains meaningfully above best-in-class software peers, constraining balance-sheet flexibility. Ongoing interest and debt service reduce free cash available for faster buybacks or big restructurings, meaning deleveraging is likely to be gradual and could limit optionality in downturns.
Decelerating topline growth
A multi-year deceleration in revenue growth weakens growth optionality and raises reliance on upsells, consumption monetization, and M&A to sustain double-digit ARR targets. Slower organic expansion can pressure longer-term margin and valuation upside absent consistent acceleration.
Asset analytics timing & services softness
Consumption-driven asset analytics growth faces regulatory/inspection cadence delays before becoming ARR, limiting near-term recurring revenue uplift. Simultaneous services weakness adds revenue volatility and slows cross-sell realization, meaning some growth levers are not yet fully durable.
Bentley Systems (BSY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$11.07B
Dividend Yield0.72%
Average Volume (3M)3.01M
Price to Earnings (P/E)43.0
Beta (1Y)0.77
Revenue Growth11.12%
EPS Growth-26.24%
CountryUS
Employees5,500
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.27
Shares Outstanding291,357,180
10 Day Avg. Volume3,460,709
30 Day Avg. Volume3,013,791
Financial Highlights & Ratios
PEG Ratio2.49
Price to Book (P/B)10.10
Price to Sales (P/S)8.00
P/FCF Ratio23.09
Enterprise Value/Market Cap1.07
Enterprise Value/Revenue7.88
Enterprise Value/Gross Profit9.67
Enterprise Value/Ebitda24.84
Forecast
1Y Price Target
$47.67Price Target Upside30.42% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
EPS Forecast (FY)1.36
Revenue Forecast (FY)$1.68B
Bentley Systems Business Overview & Revenue Model
Company DescriptionBentley Systems, Incorporated, together with its subsidiaries, provides infrastructure engineering software solutions in the Americas, Europe, the Middle East, Africa, and the Asia-Pacific. The company offers open modeling and open simulation applications for infrastructure design integration, which include MicroStation, OpenRoads, OpenRail, OpenPlant, OpenBuildings, OpenBridge, OpenSite, OpenFlows, STAAD and RAM, SACS, MOSES, AutoPIPE, SITEOPS, CUBE, DYNAMEQ, EMME, and LEGION; and geoprofessional applications for modeling and simulation of near and deep subsurface conditions, including Leapfrog, AGS Workbench, GeoStudio, Imago, MX Deposit, Oasis montaj, PLAXIS, and OpenGround. It also provides project delivery systems that support collaboration, work-sharing, and 4D construction modeling for infrastructure project delivery enterprises, such as ProjectWise, ProjectWise Design Review Service, and SYNCHRO; and asset and network performance systems, such as AssetWise ALIM, AssetWise Asset Reliability, AssetWise Enterprise Interoperability, AssetWise 4D Analytics, AssetWise Linear, and Seequent Central. In addition, it offers industry solutions comprising AssetWise Linear SUPERLOAD, AssetWise Linear Analytics, AssetWise Inspections, ContextCapture, OpenCities, OpenUtilities, OpenTower, OpenWindPower, Power Line, SPIDA, OrbitGT, sensemetrics, PlantSight, and WaterSight. The company serves civil, structural, geotechnical, geoscience subsurface engineers, architects, geospatial professionals, city and regional planners, contractors, fabricators, and operations and maintenance engineers. Bentley Systems, Incorporated was incorporated in 1984 and is headquartered in Exton, Pennsylvania.
How the Company Makes MoneyBentley Systems generates revenue through a subscription-based model, offering software licenses, maintenance, and support services. Key revenue streams include recurring subscriptions for its software products, which provide customers with continuous access to updates and technical support. Additionally, Bentley earns revenue from professional services, such as consulting and training, that assist clients in implementing their software solutions. Significant partnerships with major engineering and construction firms enhance its market reach and contribute to its earnings by embedding Bentley's software within large-scale infrastructure projects.
Bentley Systems Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where Bentley Systems is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where Bentley Systems is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyBentley Systems Earnings Call Summary
Earnings Call Date:Feb 26, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 12, 2026
Earnings Call Sentiment Positive
The call presented a broadly positive operational and financial picture: durable low-double-digit ARR and revenue growth, strong retention (109% NRR), meaningful margin expansion, robust free cash flow (+24% YoY), and active deleveraging including retirement of convertible debt. Management emphasized AI and asset analytics as strategic growth engines, with asset analytics already at a $50M run rate and several targeted acquisitions enhancing capabilities. Key challenges include services revenue decline in 2025, delays in converting some asset analytics consumption into ARR due to inspection cadences, regional headwinds (notably China), FX pressure on margins, and free cash flow timing variability. Overall, the highlights (growth, profitability, cash generation, AI/asset analytics traction) materially outweigh the lowlights, while the company set a constructive 2026 outlook with continued margin improvement and strong cash generation.Q4-2025 Updates
Positive Updates
Strong ARR Growth and Scale
Q4 ARR grew 11.5% year-over-year on a constant currency basis, ending the quarter at $1.462 billion. Management projects 2026 constant-currency ARR growth of 10.5%–12.5% and expects quarter-to-quarter ARR seasonality similar to 2025.
Revenue Growth and Subscription Mix
Full-year 2025 total revenue was $1.502 billion, up 11% reported (10% constant currency). Q4 revenue was $392 million, up 12% reported (10% CC). Subscription revenues grew 13% reported (12% CC) for the year and comprised 92% of total revenue (up 2 percentage points year-over-year).
High Retention and Net Revenue Retention
Last-12-month recurring revenues increased 12% YoY and represent 93% of total revenue. Account retention remained at 99% (constant currency) and net revenue retention stood at 109%, indicating strong customer stickiness.
Profitability Expansion
Adjusted operating income less stock-based compensation was $430 million for 2025, up 16% year-over-year, with a margin of 28.6% (a 110 basis point improvement). Q4 AOI less SBC was $94 million with a 24.1% margin, reflecting continued margin expansion.
Robust Free Cash Flow and Deleveraging
Free cash flow totaled $520 million in 2025, up 24% YoY. Management reduced net leverage to 2.1x (a four-year low), retired the 2026 convertible notes (reducing fully diluted share count by ~3%), and ended the year with an undrawn $1.3 billion revolver (plus $500 million accordion).
Asset Analytics Traction and M&A Progress
Asset analytics consumption revenue reached a $50 million run rate in 2025. Acquisitions (Pointivo assets and Talon Analytics) expanded capabilities (point cloud processing, telecom/utilities analytics). OpenTower iQ ARR moved into eight figures and Talon brought multi-eight-figure contract credibility.
SME and E365 Momentum
Q4 saw 300 basis points of ARR growth from new logos, primarily in the SME segment. For the 16th consecutive quarter Bentley added at least 600 new SME logos via the line store. E365 now comprises 45% of subscription revenues (up from 42% in 2024).
Clear 2026 Financial Outlook
Guidance for 2026: total revenue CC growth 11%–13% (implying $1.685B–$1.750B at current FX), subscription growth 11%–13% CC, adjusted operating income less operating SBC of $495M–$510M, and free cash flow of $500M–$570M. Services revenue expected to reaccelerate 15%–20% CC.
Negative Updates
Services Revenue Weakness in 2025
Full-year services revenue declined 6% reported (7% constant currency) in 2025. While Q4 saw a modest sequential increase (4% reported, 2% CC), services remain a lagging area that management expects to recover in 2026 driven largely by Maximo-related activity.
Asset Analytics ARR Classification and Timing
Asset analytics growth is material in consumption and run-rate terms ($50M run rate) but much of it is not yet recognized as ARR due to multi-year/regulatory inspection cadences (e.g., distribution pole inspections required only every 5 years), delaying full ARR conversion.
Geographic Headwinds — China and U.K. Softness
China (≈2% of ARR) faced economic and geopolitical headwinds that impacted growth in the quarter and are expected to remain a drag through 2026. The U.K. was softer in Q4 due to project pauses, although the pipeline is improving.
FX and Margin Headwind
Seequent's growth and global cost mix shift management expects a ~50 basis point FX headwind to reported margins at current rates, which was reflected in the new profitability metric and outlook.
Free Cash Flow Variability and Interest Headwind
Free cash flow is subject to timing variability from collections (Q4 is largest renewal quarter). Repayment of 2026 convertible notes increased 2026 cash interest outflow by approximately $30 million versus 2025, moderating FCF year-over-year growth.
Modest M&A ARR Contribution and Conservative Pace
M&A contributed less than 40 basis points to ARR growth in 2025. Management signaled openness to scale programmatic acquisitions (capacity up to ~$400M annually) but actual closed amounts have been modest and selectively focused to date.
Company Guidance
Bentley guided 2026 from a position of strength after 2025: full‑year 2025 revenue was $1.502B (+11% reported, +10% constant currency) with Q4 revenue $392M (+12%/+10% cc); subscription revenue grew 13%/12% and now represents 92% of revenue (E365 = 45% of subscriptions); Q4 ARR was $1.462B (+11.5% cc, +4% sequential) with L12M recurring revenue +12% (93% of total), account retention 99% and net revenue retention 109%; FY adjusted operating income less SBC was $430M (+16%) with a 28.6% margin (Q4 AOI less SBC $94M, 24.1%); free cash flow was $520M (+24%) with FCF margin ~35% and FCF less SBC ~30%; net debt leverage ended ~2.1x, the 2026 convertible was retired (reducing fully diluted shares ~3%), and 2025 cash uses included $93M of acquisitions, $135M debt paydown, $157M share repurchases and $85M dividends while keeping a $1.3B undrawn revolver (+$500M accordion) and capacity for up to ~$400M/year in programmatic M&A. For 2026 management expects total revenue growth of 11–13% CC (implying $1.685–$1.750B at current rates), subscription +11–13% CC, services +15–20% CC, ARR growth 10.5–12.5% CC, adjusted operating income less operating SBC $495–$510M, effective tax ~21%, free cash flow $500–$570M (≈45–50% in H1), and continued ~100 bps of annual margin improvement (with a metric refinement that adds ~50 bps vs. the prior definition).Bentley Systems Financial Statement Overview
Summary
Strong profitability and software margins, with free cash flow scaling well and closely matching earnings quality. The main offsets are decelerating revenue growth and a still-levered balance sheet (despite improvement), which keeps the profile below top-tier peers.Income Statement
Revenue has grown steadily over the period, but the growth rate has decelerated meaningfully (from ~20% in 2021 to low-single-digits by 2025). Profitability is a clear strength: gross margin is consistently very high (~74%–82%) and net margin improved from ~9.7% (2021) to ~18.5% (2025). A watchout is some volatility in earnings quality/margins across years (net margin peaked in 2023), and the 2025 operating margin fields appear internally inconsistent versus EBIT/EBITDA, which adds some reporting noise to the margin read-through.78
Positive
Balance Sheet
Leverage remains the primary constraint: debt-to-equity is still above 1.0 in 2025 (~1.08), though it has improved substantially from much higher levels in 2021–2022 (>3x). Equity has grown over time, helping reduce balance-sheet risk. Returns on equity are strong (~23% in 2025), but that strength is partly supported by the use of leverage, so the capital structure is less conservative than best-in-class software peers.64
Positive
Cash Flow
Cash generation is a major positive. Operating cash flow and free cash flow have scaled nicely (free cash flow rising from ~$242M in 2020 to ~$520M in 2025), with a strong step-up in 2025 free cash flow growth (~13%). Free cash flow closely tracks accounting earnings (free cash flow is ~94%–97% of net income across the period), supporting earnings quality. The main weakness is that cash flow covers only a modest portion of total debt (coverage ~0.44–0.56), so deleveraging would likely be gradual rather than rapid.84
Very Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.50B | 1.35B | 1.23B | 1.10B | 965.05M |
| Gross Profit | 1.22B | 1.10B | 910.24M | 862.07M | 748.51M |
| EBITDA | 429.05M | 382.44M | 288.44M | 304.87M | 152.34M |
| Net Income | 277.86M | 234.79M | 326.79M | 174.78M | 93.19M |
Balance Sheet | |||||
| Total Assets | 3.56B | 3.40B | 3.32B | 3.17B | 2.66B |
| Cash, Cash Equivalents and Short-Term Investments | 123.28M | 64.01M | 68.41M | 71.68M | 329.34M |
| Total Debt | 1.28B | 1.43B | 1.57B | 1.82B | 1.49B |
| Total Liabilities | 2.37B | 2.36B | 2.44B | 2.59B | 2.25B |
| Stockholders Equity | 1.19B | 1.04B | 883.28M | 572.75M | 409.22M |
Cash Flow | |||||
| Free Cash Flow | 520.21M | 421.25M | 391.69M | 255.78M | 270.49M |
| Operating Cash Flow | 538.46M | 435.29M | 416.70M | 274.32M | 288.02M |
| Investing Cash Flow | -112.31M | -143.27M | -60.50M | -770.13M | -1.06B |
| Financing Cash Flow | -376.30M | -289.85M | -359.07M | 243.03M | 982.58M |
Bentley Systems Technical Analysis
Neutral
36.55
Price Trends
36.89
Negative
41.62
Negative
47.21
Negative
Market Momentum
-0.65
Negative
56.19
Neutral
68.13
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BSY, the sentiment is Neutral. The current price of 36.55 is above the 20-day moving average (MA) of 33.83, below the 50-day MA of 36.89, and below the 200-day MA of 47.21, indicating a neutral trend. The MACD of -0.65 indicates Negative momentum. The RSI at 56.19 is Neutral, neither overbought nor oversold. The STOCH value of 68.13 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for BSY.
Bentley Systems Risk Analysis
Bentley Systems disclosed 37 risk factors in its most recent earnings report. Bentley Systems reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Bentley Systems Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $8.11B | 37.59 | 71.66% | ― | 4.10% | -0.21% | |
72 Outperform | $15.25B | 49.25 | 8.90% | ― | 10.62% | 31.43% | |
71 Outperform | $7.39B | 20.50 | 57.32% | 0.16% | 17.00% | 120.21% | |
70 Outperform | $11.07B | 43.00 | 24.92% | 0.72% | 11.12% | -26.24% | |
68 Neutral | $18.18B | 23.91 | 11.87% | 1.17% | 6.67% | 21.21% | |
65 Neutral | $12.35B | 137.81 | 6.57% | ― | 22.80% | 198.93% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
BSY
Bentley Systems
36.55
-6.02
-14.14%
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MANH
Manhattan Associates
135.43
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43.73
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13.82%
SSNC
SS&C Technologies Holdings
75.29
-12.11
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TYL
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354.69
-251.70
-41.51%
Bentley Systems Corporate Events
Business Operations and StrategyStock BuybackDividendsFinancial DisclosuresM&A Transactions
Bentley Systems Posts Strong Q4 Results and 2026 Outlook
Positive
Feb 26, 2026
Bentley Systems reported on February 26, 2026 that fourth-quarter 2025 revenue rose 11.9% year-on-year to $391.6 million, with subscription revenue up 13% and operating margin improving to 20%, while annualized recurring revenue reached $1.46 billion and free cash flow jumped to $136.2 million. For full year 2025, revenue climbed 11% to $1.50 billion, margins and EPS increased, free cash flow reached $520.2 million, and management highlighted disciplined execution, strong cash generation, and leverage reduced to 2.1 times, enabling dividends, buybacks and programmatic acquisitions.
The company set a 2026 outlook calling for constant-currency revenue growth of 11% to 13%, ARR growth of 10.5% to 12.5%, further margin expansion, and free cash flow of $500 million to $570 million, underlining confidence in continued double-digit growth. Bentley also underscored strategic progress in AI-driven asset analytics through the late-2025 acquisitions of Talon Aerolytics and Pointivo technology, positioning it for leadership in infrastructure asset optimization, while its board declared a first-quarter 2026 dividend of $0.07 per share payable March 19, 2026 to shareholders of record on March 10, 2026.
The most recent analyst rating on (BSY) stock is a Buy with a $50.00 price target. To see the full list of analyst forecasts on Bentley Systems stock, see the BSY Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.