Donnelley Financial Solutions (DFIN) AI Stock Analysis

• Market Cap: $1.55B
• Dividend Yield: N/A
• Average Volume (3M): 274.46K
• Price to Earnings (P/E): 19.9
• Beta (1Y): 1.11
• Revenue Growth: -5.93%
• EPS Growth: -19.77%
• Country: US
• Employees: 1,800
• Sector: Technology
• Sector Strength: 83
• Industry: Financial - Capital Markets
• EPS (TTM): 1.49
• Shares Outstanding: 27,494,778
• 10 Day Avg. Volume: 189,552
• 30 Day Avg. Volume: 274,457
• PEG Ratio: 1.59
• Price to Book (P/B): 4.20
• Price to Sales (P/S): 2.34
• P/FCF Ratio: 17.41
• Enterprise Value/Market Cap: 1.23
• Enterprise Value/Revenue: 2.53
• Enterprise Value/Gross Profit: 4.35
• Enterprise Value/Ebitda: 9.71
• 1Y Price Target: $68.67
• Price Target Upside: 21.91% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 64 Neutral
• Price Target: $60.00 ▲(6.52% Upside)

Donnelley Financial Solutions' overall stock score reflects a stable financial performance with strong profitability and cash flow, despite revenue challenges. The technical analysis indicates some short-term weakness, while the valuation suggests moderate pricing. The earnings call provided a mixed outlook, with strong software growth but declines in other areas. These factors collectively contribute to a balanced but cautious investment outlook.

Positive Factors

Software Revenue

Software revenue came in above expectations, and EBITDA/EPS beat Street estimates as the company continues to improve efficiency and return capital to shareholders through buybacks.

Stock Buyback

DFIN has ramped up the buyback, with the company announcing that they have repurchased approximately 5% of the outstanding shares.

Valuation

The shares are now trading at an FY26 P/E multiple of just 12.5x, creating what is seen as a favorable risk-reward for small-cap investors.

Negative Factors

Capital Markets Outlook

The company provided a cautious outlook on capital markets revenue expectations as the recovery in the demand for DFIN's services remains uneven.

De-Spac Mergers

De-Spac mergers have been falling and have negatively impacted revenue, down 56% year over year.

Revenue Shortfall

DFIN's 2Q results were mixed, with revenue coming in below expectations due to lighter print revenue.

Donnelley Financial Solutions Business Overview & Revenue Model

Company Description

Donnelley Financial Solutions (DFIN) is a leading provider of regulatory compliance and financial reporting services based in the United States. The company specializes in delivering cutting-edge technology solutions and comprehensive services for public and private companies, investment firms, and other organizations that require assistance with financial disclosures, data analytics, and document management. DFIN operates primarily in the financial services sector, offering products such as EDGAR filing services, risk and compliance solutions, and investor communications services.

How the Company Makes Money

DFIN generates revenue through a diversified model that includes several key streams. Primarily, the company earns money by providing regulatory filing services, where clients pay for assistance in preparing and submitting documents to regulatory bodies like the SEC. Another significant revenue source comes from its SaaS offerings, which include advanced technology platforms that help clients manage their financial data and reporting needs more efficiently. DFIN also generates income from its advisory services, where it provides strategic consulting related to compliance, risk management, and governance. Additionally, partnerships with financial institutions and technology providers enhance its offerings and contribute to revenue growth by expanding its client base and service capabilities.

Donnelley Financial Solutions Financial Statement Overview

Summary

Donnelley Financial Solutions presents a solid financial profile with strong profitability and effective leverage management. High profit margins and a balanced debt structure are positive, but declining revenue growth and negative free cash flow growth require attention.

Income Statement

Donnelley Financial Solutions demonstrated strong profitability with a gross profit margin of 68% TTM, which improved from the previous year. Net profit margin stood at 11.6% TTM, indicating stable profit generation. However, the revenue growth has been declining with a 1.2% decrease TTM. The EBIT and EBITDA margins, at 11.9% and 26.2% respectively, reflect healthy operational efficiency despite the revenue downturn.

Balance Sheet

The company maintains a moderate debt-to-equity ratio of 0.49, suggesting a balanced leverage. Return on equity is strong at 21.5% TTM, showcasing effective use of shareholders' equity. However, the equity ratio is at 49.2%, indicating a moderate reliance on liabilities to finance assets. Overall, the balance sheet reflects financial stability with room for improvement in asset management.

Cash Flow

Operating cash flow to net income ratio is robust at 1.79, indicating efficient cash generation from operations. Free cash flow to net income ratio is 1.05, suggesting that most of the earnings translate into free cash flow. However, the free cash flow growth rate has been negative, necessitating improved cash management strategies.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	755.00M	781.90M	797.20M	833.60M	993.30M	894.50M
Gross Profit	439.20M	484.00M	463.90M	463.40M	580.20M	398.50M
EBITDA	196.60M	209.70M	192.00M	212.00M	290.50M	82.20M
Net Income	82.10M	92.40M	82.20M	102.50M	145.90M	-25.90M
Balance Sheet
Total Assets	874.70M	841.60M	806.90M	828.30M	883.30M	865.60M
Cash, Cash Equivalents and Short-Term Investments	33.80M	57.30M	23.10M	34.20M	54.50M	73.60M
Total Debt	203.90M	141.40M	150.60M	213.90M	181.30M	301.30M
Total Liabilities	442.60M	405.50M	404.70M	498.80M	506.30M	617.80M
Stockholders Equity	432.10M	436.10M	402.20M	329.50M	377.00M	247.80M
Cash Flow
Free Cash Flow	109.30M	105.20M	62.20M	96.00M	137.70M	123.10M
Operating Cash Flow	173.50M	171.10M	124.00M	150.20M	180.00M	154.20M
Investing Cash Flow	-64.10M	-53.30M	-51.30M	-50.90M	-45.00M	-19.80M
Financing Cash Flow	-111.10M	-82.10M	-84.60M	-121.10M	-154.90M	-77.50M

Donnelley Financial Solutions Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 56.33
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DFIN, the sentiment is Positive. The current price of 56.33 is above the 20-day moving average (MA) of 55.49, below the 50-day MA of 58.66, and above the 200-day MA of 55.81, indicating a neutral trend. The MACD of -0.33 indicates Negative momentum. The RSI at 49.66 is Neutral, neither overbought nor oversold. The STOCH value of 47.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DFIN.

Donnelley Financial Solutions Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MC	80 Outperform	$5.79B	27.69	45.36%	3.55%	42.85%	1398.33%
SF	77 Outperform	$11.82B	22.37	11.11%	1.56%	8.76%	10.32%
XP	67 Neutral	$9.43B	11.06	22.42%	3.44%	-6.77%	2.95%
LPLA	65 Neutral	$28.80B	24.37	29.46%	0.36%	29.23%	13.45%
DFIN	64 Neutral	$1.55B	19.90	18.80%	―	-5.93%	-19.77%
PJT	64 Neutral	$6.26B	30.89	106.47%	0.56%	18.40%	54.77%
Sector *	61 Neutral	$35.52B	8.84	-11.06%	1.87%	8.55%	-8.14%

Donnelley Financial Solutions Corporate Events

Donnelley Financial Solutions Announces New Share Repurchase Program

On May 14, 2025, Donnelley Financial Solutions held its Annual Meeting of Stockholders, where all nominated directors were elected, an advisory resolution on executive compensation was approved, an amendment to the 2016 Performance Incentive Plan was passed, and Deloitte & Touche LLP was ratified as the independent auditor for fiscal year 2025. Following the meeting, on May 15, 2025, the Board authorized a new share repurchase program of up to $150 million, effective through December 31, 2026, replacing the previous program with $15 million remaining. This initiative reflects the company’s strategic approach to managing its capital and enhancing shareholder value.