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Sapiens International (SPNS)
NASDAQ:SPNS
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Sapiens (SPNS) AI Stock Analysis

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SPNS

Sapiens

(NASDAQ:SPNS)

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Neutral 68 (OpenAI - 4o)
Rating:68Neutral
Price Target:
$47.00
▲(9.07% Upside)
Sapiens' strong financial performance is the primary driver of its stock score, supported by robust revenue growth and a well-managed balance sheet. The technical analysis indicates a bullish trend, though overbought conditions suggest caution. The high P/E ratio raises valuation concerns, partially offset by a modest dividend yield.
Positive Factors
Recurring Revenue Growth
The increase in recurring revenue enhances revenue predictability and stability, supporting long-term financial health and strategic growth.
Strategic Acquisitions
These acquisitions expand Sapiens' market presence and product offerings, strengthening its competitive position and growth potential.
Improvement in Gross Margin
Improved gross margin indicates better cost management and operational efficiency, enhancing profitability and financial resilience.
Negative Factors
Currency Impact on Revenue
Currency fluctuations can adversely affect revenue, posing a risk to financial performance and complicating international operations.
Decline in European Revenue
A decline in European revenue suggests regional challenges, potentially impacting overall growth and necessitating strategic adjustments.
Loss-Making Acquisitions
Loss-making acquisitions could strain profitability, requiring effective integration and management to realize long-term strategic benefits.

Sapiens (SPNS) vs. SPDR S&P 500 ETF (SPY)

Sapiens Business Overview & Revenue Model

Company DescriptionSapiens International Corporation N.V. provides software solutions for the insurance and financial services industries in North America, the European Union, the United Kingdom, Israel, and internationally. The company offers Sapiens CoreSuite and Sapiens IDITSuite for personal, commercial, and specialty lines; and Sapiens CoreSuite, Sapiens UnderwritingPro, Sapiens ApplicationPro, Sapiens IllustrationPro, and Sapiens ConsolidationMaster for life, pension, and annuities. It also provides Sapiens DigitalSuite for customers, agents, brokers, risk managers, customer groups and third-party service providers; Sapiens ReinsuranceMaster and Sapiens ReinsurancePro reinsurance solutions; and Sapiens Platform, Sapiens CoreSuite, Sapiens PolicyPro, and Sapiens ClaimsPro, as well as Sapiens PolicyGo, and Sapiens ClaimsGo for workers' compensation. In addition, the company offers financial and compliance solutions, which comprise Sapiens FinancialPro, Sapiens Financial GO, Sapiens StatementPro, Sapiens CheckPro, and Sapiens Reporting Tools; and Sapiens Decision, an enterprise-scale platform that enables institutions to centrally author, store, and manage various organizational business logics. Further, it provides tailor-made solutions based on its Sapiens eMerge platform; and program delivery, business, and managed services. The company markets and sells its products and services through direct and partner sales. Sapiens International Corporation N.V. was founded in 1982 and is headquartered in Holon, Israel.
How the Company Makes MoneySapiens generates revenue primarily through software licensing, maintenance contracts, and professional services. The company offers its software solutions on a subscription basis, where clients pay for the use of the software over time, creating a recurring revenue stream. In addition to licensing, Sapiens earns income from maintenance and support services, ensuring that clients receive ongoing updates and assistance. Professional services, including implementation, customization, and consulting, contribute significantly to the revenue model, as these services often accompany software sales. Furthermore, Sapiens has established strategic partnerships with key players in the insurance industry, enhancing its market presence and facilitating access to new clients, which further drives its earnings.

Sapiens Earnings Call Summary

Earnings Call Date:Aug 13, 2025
(Q1-2025)
|
% Change Since: |
Next Earnings Date:Nov 06, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a generally positive outlook, with strong revenue growth, strategic acquisitions, and robust performance in North America and APAC. However, challenges such as currency impacts, a decrease in European revenue, and short-term profit impacts from acquisitions balance the narrative.
Q1-2025 Updates
Positive Updates
Strategic Acquisitions
Sapiens International Corporation announced the acquisition of Candela and Advantage Go, enhancing capabilities in the Life platform and expanding the global P&C proposition. These acquisitions are expected to contribute to significant growth, especially in APAC and the London specialty market.
Revenue Growth
First quarter 2025 revenue increased by 1.4% to $136 million compared to $134 million in Q1 2024. On a constant currency basis, revenue would have been $2 million higher.
Increase in Annualized Recurring Revenue
Annualized recurring revenue (ARR) for Q1 2025 totaled $187 million, reflecting an 11.8% increase from Q1 2024, driven by new logos signed in the previous quarter.
North America and APAC Growth
Revenue in North America increased by 3.1% and in the Rest of the World, including APAC, by 13.4% compared to last year, demonstrating robust growth in these regions.
Strong Life and Annuity Business
Life and Annuity businesses showed multiple wins and go-lives, with new deals signed in North America and Europe, indicating a strong demand for life system transformation.
Negative Updates
Negative Currency Impact
The first quarter of 2025 saw a negative currency impact compared to Q1 2024, which affected revenue figures. On a constant currency basis, revenue would have been $2 million higher.
Decrease in European Revenue
Revenue in Europe decreased by 1.8% compared to last year. On a constant currency basis, revenue in Europe would have been 0.6% higher.
Implementation Revenue Decline
Revenue from implementation decreased to $28 million compared to $40 million in Q1 2024, reflecting the completion of several go-live projects and extended timelines for existing projects.
Profit Impact from Acquisitions
While the acquisitions of Candela and Advantage Go are strategically valuable, they are expected to have a short-term negative impact on profitability, with Advantage Go remaining loss-making throughout the year.
Company Guidance
During Sapiens International Corporation's first quarter 2025 earnings call, the company provided updated guidance and highlighted key metrics and strategic initiatives. Sapiens reported Q1 2025 revenue of $136 million, a 1.4% increase over Q1 2024, with annualized recurring revenue (ARR) rising 11.8% to $187 million. The company raised its 2025 non-GAAP revenue guidance to $574-$578 million, indicating 6% growth at the midpoint, and revised its operating profit target to $94-$96 million. Sapiens announced strategic acquisitions of Candela and Advantage Go, expected to add $21 million in revenue and enhance growth in key markets such as North America, EMEA, and APAC. The company continues to focus on cloud adoption, with a target penetration rate of over 60% within five years, and aims for mid-to-high single-digit revenue growth in 2026. Despite a temporary dip in profitability due to acquisitions, Sapiens anticipates robust long-term growth and profitability improvements.

Sapiens Financial Statement Overview

Summary
Sapiens exhibits strong financial performance with consistent revenue growth, high profitability margins, and stable cash flows. The balance sheet shows effective debt management and robust equity, supporting long-term growth and sustainability. Continuous monitoring of leverage and cash flow trends will be crucial to maintain its financial health.
Income Statement
85
Very Positive
Sapiens demonstrated strong income statement metrics with a consistent revenue growth trajectory, highlighted by a TTM revenue of $544.2M, up from $542.4M in 2024. The company's gross profit margin stands at 44.6%, with a net profit margin of 13.4% in TTM, indicating solid profitability. EBIT and EBITDA margins of 15.9% and 19.4% respectively, further underscore operational efficiency. The revenue growth rate from 2023 to 2024 was 5.4%, showcasing a steady upward trend.
Balance Sheet
78
Positive
The balance sheet reflects a strong equity position with a stockholders' equity of $460.6M and an equity ratio of 64.5% in TTM, indicating financial stability. The debt-to-equity ratio has improved to 0.09 in TTM, down from 0.13 in 2024, showcasing effective leverage management. Additionally, return on equity (ROE) remains robust at 15.8%, suggesting efficient use of equity capital.
Cash Flow
72
Positive
Sapiens has demonstrated healthy cash flow metrics, with a TTM free cash flow of $78.8M and a free cash flow to net income ratio of 1.08, indicating strong cash generation relative to earnings. The operating cash flow to net income ratio is 1.22, reflecting efficient cash operations. The free cash flow growth rate from 2023 to 2024 was 13.1%, suggesting a positive trend in cash flow generation.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue544.24M542.38M514.58M474.74M461.04M382.90M
Gross Profit242.78M238.11M219.59M200.16M187.84M155.97M
EBITDA105.81M105.92M94.86M83.52M84.12M63.62M
Net Income72.75M72.18M62.44M52.59M47.17M33.77M
Balance Sheet
Total Assets713.98M691.71M689.62M666.75M714.99M714.16M
Cash, Cash Equivalents and Short-Term Investments205.86M216.19M202.12M180.28M210.24M182.56M
Total Debt43.20M63.75M87.05M116.57M148.36M177.17M
Total Liabilities239.64M212.08M239.68M265.49M306.27M330.47M
Stockholders Equity460.59M479.63M447.27M400.50M406.55M381.69M
Cash Flow
Free Cash Flow78.77M79.35M70.16M34.73M68.69M47.01M
Operating Cash Flow88.87M82.22M79.42M43.78M80.54M58.26M
Investing Cash Flow-9.85M13.41M-72.78M-12.44M125.00K-114.60M
Financing Cash Flow-53.18M-56.28M-43.34M-58.38M-39.96M156.51M

Sapiens Technical Analysis

Technical Analysis Sentiment
Positive
Last Price43.09
Price Trends
50DMA
42.05
Positive
100DMA
35.51
Positive
200DMA
31.07
Positive
Market Momentum
MACD
0.41
Positive
RSI
75.37
Negative
STOCH
47.62
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SPNS, the sentiment is Positive. The current price of 43.09 is above the 20-day moving average (MA) of 43.01, above the 50-day MA of 42.05, and above the 200-day MA of 31.07, indicating a bullish trend. The MACD of 0.41 indicates Positive momentum. The RSI at 75.37 is Negative, neither overbought nor oversold. The STOCH value of 47.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SPNS.

Sapiens Risk Analysis

Sapiens disclosed 39 risk factors in its most recent earnings report. Sapiens reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Sapiens Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
69
Neutral
$1.94B41.1010.75%0.41%31.41%-40.89%
68
Neutral
$2.41B35.3914.27%1.37%3.08%-1.02%
65
Neutral
$2.31B-11.47%29.63%29.87%
65
Neutral
$3.88B-3.52%-8.80%-657.91%
61
Neutral
$37.18B12.37-10.20%1.83%8.50%-7.62%
48
Neutral
$1.42B-12.65%4.90%-820.72%
46
Neutral
$1.60B-29.09%5.39%-19.48%-398.43%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SPNS
Sapiens
43.09
6.28
17.06%
CALX
Calix
59.42
20.79
53.82%
PAR
Par Technology
35.06
-26.96
-43.47%
PRGS
Progress Software
45.16
-20.22
-30.93%
ALIT
Alight
2.97
-3.98
-57.27%
ALKT
Alkami Technology
22.17
-16.04
-41.98%

Sapiens Corporate Events

Sapiens’ AdvantageGo Launches Underwriting Workbench 3.0
Oct 9, 2025

On October 9, 2025, Sapiens’ AdvantageGo launched Underwriting Workbench 3.0, a significant upgrade aimed at transforming underwriting processes in the property and casualty markets of EMEA and North America. This new version introduces an intelligent business management solution with features like non-linear workflows, real-time analytics, and seamless integration with Microsoft tools, enhancing decision-making and operational efficiency for underwriters. The release is expected to strengthen Sapiens’ market position and drive expansion in the global P&C market.

Sapiens Completes Major IDITSuite Upgrade for MPS
Sep 17, 2025

On September 17, 2025, Sapiens International Corporation announced the successful completion of a major upgrade of the IDITSuite for the Medical Protection Society (MPS), a leading protection organization for healthcare professionals. The upgrade, which advanced MPS’ core suite by six versions, provides future-proof architecture, extended lifecycle support, enhanced functionality, and improved performance and security. This strategic enhancement is expected to allow MPS to react faster to industry developments, improve user experience, and reduce total cost of ownership, showcasing Sapiens’ commitment to empowering clients with robust, forward-looking solutions.

Sapiens Launches Automated Testing Services with Encova Insurance
Sep 10, 2025

On September 10, 2025, Sapiens International Corporation announced the first implementation of its Automated Testing Services (ATS) with Encova Insurance, a multi-line mutual insurer. This deployment aims to streamline testing processes, improve software quality, and enhance operational efficiency for Encova’s workers’ compensation operations. The implementation, which began in April 2025, is expected to significantly reduce testing time and improve the consistency of software releases, allowing Encova to focus on strategic priorities. The use of Microsoft Playwright and a custom framework by Sapiens will provide Encova with personalized support and increased operational flexibility.

Sapiens Unveils Enhanced CoreSuite for North American P&C Market
Sep 9, 2025

On September 9, 2025, Sapiens International Corporation launched an enhanced version of its CoreSuite for Property & Casualty for the North American insurance market. The new version, 13.0, features significant upgrades to claims, billing, and underwriting, aimed at improving operational efficiency and user experience. These enhancements are designed to address challenges faced by North American P&C clients, such as visibility into underwriting and integration complexities. The release is part of Sapiens’ strategy to leverage corporate investments to support customer needs, and it includes AI-powered tools for smarter underwriting and streamlined billing processes.

Sapiens Partners with Bankers Insurance for Digital Modernization
Aug 20, 2025

On August 20, 2025, Sapiens International Corporation announced that Bankers Insurance Group has chosen Sapiens CoreSuite for Property & Casualty to modernize its core systems. This strategic partnership aims to support Bankers’ growth strategy by enhancing operational efficiency and scalability, starting with builder’s risk and business owner’s policy. The transition to Sapiens’ modern platform will enable Bankers to improve service levels, reduce manual processing, and better navigate the competitive insurance market, ultimately positioning them for long-term growth.

Sapiens Announces Merger Agreement with SI Swan Entities
Aug 14, 2025

On August 12, 2025, Sapiens International Corporation N.V. entered into a Merger Agreement with SI Swan UK Bidco Limited, SI Swan Guernsey Holdco Limited, and SI Swan Cayman Merger Sub Ltd. The agreement outlines a merger where the Merger Sub will merge with and into Sapiens, with Sapiens being the surviving entity. This strategic move is significant for Sapiens as it could impact its market positioning and stakeholder relations, although it is subject to various conditions and approvals. The announcement also includes a Support Agreement with a Rollover Shareholder concerning a substantial number of common shares, indicating strong backing for the merger.

Sapiens Announces Q2 2025 Financial Results and Acquisition by Advent
Aug 13, 2025

On August 13, 2025, Sapiens International Corporation announced its financial results for the second quarter of 2025, ending June 30. The company reported a revenue increase of 3.5% compared to the previous year, reaching $141.6 million. However, the operating income and net income showed a decline of 23.2% and 23.6%, respectively. During the quarter, Sapiens completed the acquisitions of Advantage Go and Candella, which are expected to bolster growth in its P&C and Life segments. The company emphasized its strategic focus on platform innovation, cloud adoption, and global expansion in the Life & Annuities business to drive accelerated growth in 2026. Additionally, Sapiens announced a definitive agreement to be acquired by Advent, leading to the cancellation of its scheduled Q2 2025 earnings call.

Sapiens Acquired by Advent for $2.5 Billion
Aug 13, 2025

On August 12, 2025, Sapiens International Corporation N.V. announced its acquisition by Advent, a global private equity investor, for $43.50 per share in an all-cash transaction valuing the company at approximately $2.5 billion. This acquisition marks a significant milestone for Sapiens, enabling accelerated innovation and global reach expansion in the insurance technology sector. The transaction, approved by Sapiens’ Board of Directors, offers a 64% premium over the company’s undisturbed share price and is expected to close in late 2025 or early 2026. Upon completion, Sapiens will become a privately held company, with existing shareholder Formula Systems retaining a minority stake. The merger is anticipated to enhance Sapiens’ digital transformation capabilities, leveraging Advent’s resources and expertise to drive growth and innovation in SaaS-based insurance solutions.

Sapiens UnderwritingPro Named ‘Dominant Provider’ by Datos Insights
Aug 7, 2025

On August 7, 2025, Sapiens International Corporation announced that its UnderwritingPro solution has been recognized as a ‘Dominant Provider’ in Datos Insights’ 2025 report on Life/Annuity/Benefits New Business and Underwriting Systems. This accolade underscores the strength of Sapiens’ underwriting technology, which integrates AI and offers robust capabilities for automating underwriting decisions. The recognition highlights Sapiens’ strategic commitment to innovation and positions the company favorably in the competitive insurance technology market, potentially enhancing its appeal to stakeholders and expanding its market influence.

Sapiens and Earnix Unveil New Connector for Insurers
Aug 6, 2025

On August 6, 2025, Sapiens International Corporation and Earnix announced the launch of the Earnix Price-It Connector for Sapiens IDITSuite, aimed at enhancing operational efficiency for P&C insurers in EMEA and APAC. This partnership integrates Earnix’s AI-driven pricing and rating capabilities with Sapiens’ policy administration system, enabling insurers to optimize pricing strategies, improve profitability, and streamline operations through seamless data flow and real-time premium calculations.

Sapiens to Release Q2 2025 Financial Results on August 13
Jul 23, 2025

On July 23, 2025, Sapiens International Corporation announced that it will release its financial results for the second quarter of 2025 on August 13, 2025. The company will host a conference call and webcast to discuss the results, highlighting its ongoing commitment to transparency and stakeholder engagement. This announcement underscores Sapiens’ strategic focus on maintaining its leadership position in the insurance software industry and its dedication to fostering strong relationships with investors and customers.

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.Date of analysis: Oct 16, 2025