SPS Commerce (SPSC)
NASDAQ:SPSC
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SPS Commerce
(NASDAQ:SPSC)
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Rating:74Outperform
Price Target:
$57.00
▼(-1.08% Downside)
Action:Upgraded
Date:05/01/26
The score is driven primarily by strong financial quality (growth, cash generation, and minimal leverage). This is partially offset by weak longer-term technical trends and a relatively rich valuation, while the latest earnings call adds a modest positive tilt due to EBITDA expansion and product momentum but with notable Amazon-related near-term growth and churn risks.
Positive Factors
Recurring subscription network
A large base of ~54k recurring customers and a solid ARPU imply durable, predictable revenue and high customer stickiness driven by network effects. This recurring model supports long-term cash flow visibility, easier upsell, and slower churn versus one-off software sales.
Negative Factors
Amazon 3P policy headwinds
Policy-driven declines in Amazon-related recoverable revenue create a structural concentration risk: a large marketplace's rules are suppressing a specific revenue stream. This can mute topline growth and complicate multi-quarter planning until Amazon-related volumes recover.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring subscription network
A large base of ~54k recurring customers and a solid ARPU imply durable, predictable revenue and high customer stickiness driven by network effects. This recurring model supports long-term cash flow visibility, easier upsell, and slower churn versus one-off software sales.
Read all positive factors
SPS Commerce Key Performance Indicators (KPIs)
Any
Annual Recurring Revenue Per User
Measures the average revenue generated from each user annually, indicating the company's success in monetizing its user base and potential for scaling revenue growth.
Measures the average revenue generated from each user annually, indicating the company's success in monetizing its user base and potential for scaling revenue growth.
Data provided by:
The Fly
The FlySPS Commerce (SPSC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.97B
Dividend YieldN/A
Average Volume (3M)548.93K
Price to Earnings (P/E)26.4
Beta (1Y)1.06
Revenue Growth13.79%
EPS Growth11.28%
CountryUS
Employees2,783
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)2.41
Shares Outstanding36,712,704
10 Day Avg. Volume527,170
30 Day Avg. Volume548,926
Financial Highlights & Ratios
PEG Ratio1.92
Price to Book (P/B)3.47
Price to Sales (P/S)4.49
P/FCF Ratio22.17
Enterprise Value/Market Cap0.92
Enterprise Value/Revenue2.38
Enterprise Value/Gross Profit3.57
Enterprise Value/Ebitda10.13
Forecast
1Y Price Target
$70.50Price Target Upside22.35% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)4.72
Revenue Forecast (FY)$798.38M
SPS Commerce Business Overview & Revenue Model
Company Description
SPS Commerce, Inc. provides cloud-based supply chain management solutions worldwide. It offers solutions through the SPS Commerce, a cloud-based platform that enhances the way retailers, suppliers, grocers, distributors, and logistics firms manage...
How the Company Makes Money
SPS Commerce primarily makes money by charging customers recurring fees for access to and use of its cloud-based commerce network and related services. The company’s main revenue stream is subscription-based revenue from solutions that enable cust...
SPS Commerce Earnings Call Summary
Earnings Call Date:Apr 30, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 23, 2026
Earnings Call Sentiment Positive
The call presents a constructive long-term narrative driven by recurring revenue growth, strong adjusted EBITDA, cash generation and active buybacks, accelerating product velocity and promising early results from the MAX AI beta (400 customers, tangible ROI examples). However, material near-term headwinds tied to Amazon policy changes and an upcoming subscription fee for small 3P customers create customer-count churn risk and moderate near-term growth (Q2 guidance ~4% YoY), offsetting some optimism. Management expects the Amazon-specific pressure to trough by late 2026 with reacceleration thereafter and is emphasizing AI-driven efficiency and cross-sell to sustain mid/long-term high-single-digit growth (excluding Amazon). Overall, positives (product momentum, margin initiatives, buybacks and guidance for full-year growth and EBITDA expansion) modestly outweigh the identifiable near-term Amazon-related risks.Positive Updates
Top-line Growth
Q1 revenue grew 6% year-over-year to $192.1 million; recurring revenue grew 7% YoY, driven by Fulfillment growth of 8%.
Negative Updates
Amazon Revenue Recovery Headwinds
Amazon-related policy changes are creating sustained headwinds in the Amazon 3P revenue recovery business; management expects this segment to trough mid-to-late 2026 with momentum returning in 2027. The Amazon headwind was cited as a primary reason for softer near-term growth and for coming in toward the lower end of recent ranges.
Read all updates
Q1-2026 Updates
Positive
Negative
Top-line Growth
Q1 revenue grew 6% year-over-year to $192.1 million; recurring revenue grew 7% YoY, driven by Fulfillment growth of 8%.
Read all positive updates
Company Guidance
Management guided Q2 2026 revenue of $194.5–$196.5M (≈4% YoY at the midpoint), adjusted EBITDA of $60.9–$62.4M, GAAP diluted EPS of $0.53–$0.56 (≈37.3M diluted shares), and non‑GAAP diluted income per share of $1.06–$1.09 with Q2-level stock‑based compensation of ≈$19M, depreciation ≈$5.2M and amortization ≈$9.4M; for full‑year 2026 they forecast revenue of $796–$802M (≈6% growth at the midpoint), adjusted EBITDA of $262.8–$267.3M (≈14–16% growth), GAAP diluted EPS of $2.66–$2.69 (≈37.3M shares), and non‑GAAP diluted income per share of $4.73–$4.76 with annual stock‑based compensation ≈$69.8M, depreciation ≈$23M, amortization ≈$37.4M and an approximate 30% effective tax rate on GAAP pre‑tax earnings; management also reiterated continued Amazon 3P headwinds, plans a $19.99/month 3P platform fee rolling out in Q2–Q3 that could reduce the 3P supplier base by up to ~4,000 (but is not expected to be material to revenue).SPS Commerce Financial Statement Overview
Summary
Income Statement
88
Very Positive
Balance Sheet
93
Very Positive
Cash Flow
90
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 762.08M | 751.50M | 637.76M | 536.91M | 450.88M | 385.28M |
| Gross Profit | 509.25M | 482.71M | 427.05M | 354.84M | 297.81M | 253.60M |
| EBITDA | 179.32M | 182.09M | 131.11M | 112.00M | 99.37M | 78.45M |
| Net Income | 90.87M | 93.34M | 77.05M | 65.82M | 55.13M | 44.60M |
Balance Sheet | ||||||
| Total Assets | 1.16B | 1.17B | 1.03B | 823.84M | 672.91M | 615.85M |
| Cash, Cash Equivalents and Short-Term Investments | 154.27M | 151.35M | 241.02M | 275.44M | 214.31M | 257.31M |
| Total Debt | 6.62M | 10.03M | 12.47M | 14.03M | 17.29M | 20.53M |
| Total Liabilities | 199.05M | 195.97M | 176.54M | 156.37M | 135.84M | 131.59M |
| Stockholders Equity | 962.16M | 973.89M | 854.69M | 667.48M | 537.07M | 484.26M |
Cash Flow | ||||||
| Free Cash Flow | 166.92M | 152.27M | 137.35M | 112.54M | 80.17M | 93.31M |
| Operating Cash Flow | 194.44M | 178.79M | 157.40M | 132.30M | 100.05M | 112.89M |
| Investing Cash Flow | -28.51M | -169.15M | -110.45M | -92.64M | -112.79M | -46.70M |
| Financing Cash Flow | -107.74M | -100.83M | -23.03M | 15.97M | -31.63M | -8.36M |
SPS Commerce Technical Analysis
Negative
57.62
Price Trends
55.75
Negative
66.47
Negative
82.91
Negative
Market Momentum
-1.15
Positive
46.43
Neutral
53.15
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SPSC, the sentiment is Negative. The current price of 57.62 is above the 20-day moving average (MA) of 54.50, above the 50-day MA of 55.75, and below the 200-day MA of 82.91, indicating a bearish trend. The MACD of -1.15 indicates Positive momentum. The RSI at 46.43 is Neutral, neither overbought nor oversold. The STOCH value of 53.15 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SPSC.
SPS Commerce Risk Analysis
SPS Commerce disclosed 29 risk factors in its most recent earnings report. SPS Commerce 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
SPS Commerce Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $4.54B | 16.85 | 12.66% | ― | 27.27% | ― | |
74 Outperform | $1.97B | 26.37 | 9.45% | ― | 13.79% | 11.28% | |
74 Outperform | $2.19B | 33.25 | 10.20% | ― | 27.12% | ― | |
72 Outperform | $3.34B | 77.63 | 15.53% | ― | 18.43% | ― | |
70 Outperform | $2.81B | 346.71 | -3.71% | ― | 10.74% | 74.22% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | $2.58B | 20.79 | 24.04% | ― | 7.22% | 6.31% |
* Technology Sector Average
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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.