Stock fact sheet · data as of
The Descartes Systems Group Inc. (DSGX): fair value, margin of safety and Wheel Score
Technology · Software - Application · Canada · Quality / Blue-Chip
Is DSGX undervalued?
At 88.64 (close of 16 Oct 2026), DSGX trades 37% over the GLS average fair value of 64.81, with 2 of 8 models above the price. The stock earns none of the Wheel Score's Value points at this price. That is a statement about price against trailing fundamentals, not about the company's prospects - the Wall Street View and the Growth tab on the Quote page carry the forward numbers.
The 8 models disagree widely: EPV gives 24.31 while DCF gives 117.49. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.
The nightly engine files DSGX under Quality / Blue-Chip: a high moat score and a high health score together.
Nine valuation models for DSGX
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 117.49 | +33% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 30.79 | -65% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 74.34 | -16% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 28.72 | -68% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 53.42 | -40% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 85.56 | -3% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 103.84 | +17% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | - | - | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend; no value tonight |
| EPV | 24.31 | -73% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | 2.39 | -97% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 99.00 | +12% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
On financial health DSGX scores 8/9 (Piotroski): most of the nine tests - positive earnings and cash flow, falling debt, rising margins and turnover - are passed, which is the kind of balance sheet a wheel trader is happy to be assigned. The GLS Moat score is 9.2 out of 10, built from ten years of revenue, earnings, margins, cash flow, share count and returns on capital scored for consistency - a high reading that points to a durable business.
Returns on capital are moderate - ROIC 10.1%, ROE 10.2%, ROA 8.7% - with debt at 0.01 times equity and a free-cash-flow yield of 3.9%.
The Descartes Systems Group Inc. pays no dividend, so the DDM model does not apply and a covered-call holder earns only the premium and any price gain. Revenue comes mainly from Service 93%, Professional services and other 7%, License 0% (fiscal year FY2026).
Institutional ownership scores 10/10, insider activity 5/10 and Congressional trading 10/10 on the GLS smart-money scales.
| Piotroski F-score | 8 / 9 | ROIC | 10.1% |
|---|---|---|---|
| GLS Moat | 9.2 / 10 | ROE | 10.2% |
| Debt / equity | 0.01 | ROA | 8.7% |
| Free-cash-flow yield | 3.9% | Payout ratio | 0% |
| Institutions | 10 / 10 | Insiders · Congress | 5 · 10 / 10 |
Wheel Score 69: Good
DSGX scores 69 out of 100 on the Wheel Score (Good band, 65-79). The score blends the margin of safety (Value, 0/25), Piotroski health (18/20), the GLS moat (14/15), the option premium on offer (20/20) and how easily the stock trades (17/20). Value (0/25) is the part holding the score back.
Implied volatility is 42% on the near-the-money contracts 20-60 days out - inside the 35-60% range the Wheel Score pays full marks for: enough premium to be worth selling, not so much that the risk is unpaid. Chain open interest is thin - 1,713 contracts across every expiry - so fills at a fair price are not guaranteed; a 30-45-day put may not exist at a usable strike.
Volume runs at 886k shares a day on a market cap of $7.6B, with a beta of 0.19 - a low beta, so day-to-day moves are smaller than the market's; the Stability part of the Wheel Score gives that 17 of 20.
| Part | Points | From | |
|---|---|---|---|
| Value | 0 / 25 | -37% margin of safety | |
| Health | 18 / 20 | Piotroski 8/9 | |
| Moat | 14 / 15 | moat 9.2/10 | |
| Premium | 20 / 20 | implied volatility 42% | |
| Stability | 17 / 20 | 886k shares/day, $7.6B cap, beta 0.19 |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.
Upcoming events
The next earnings report is due on 2 Dec 2026, 47 days away - outside the window of a 30-45-day put sold today.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Software - Application
The 12 companies below are the closest to The Descartes Systems Group Inc. by market cap within the Software - Application industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
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| APPF AppFolio Inc. | 218.61 | 168.63 | -30% | 62Fair | $7.7B |
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| TTAN ServiceTitan, Inc. | 72.69 | 66.05 | -10% | 45Weak | $6.9B |
| PCTY Paylocity Holding Corporation | 159.10 | 180.04 | +12% | 81Prime | $8.4B |
| IDCC InterDigital, Inc. | 328.06 | 341.88 | +4% | 69Good | $8.5B |
| PCOR Procore Technologies, Inc. | 55.97 | 49.21 | -14% | 45Weak | $8.5B |
| CVLT Commvault Systems, Inc. | 158.91 | 49.00 | -224% | 58Fair | $6.6B |
| LYFT Lyft, Inc. | 17.16 | 194.22 | +91% | 80Prime | $6.5B |
| YMM Full Truck Alliance Co. Ltd. | 8.54 | 26.74 | +68% | 73Good | $8.9B |
| OTEX Open Text Corporation | 25.83 | 121.03 | +79% | 94Prime | $6.3B |
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Start free See the Sunday ScanQuestions about DSGX
Is DSGX undervalued right now?
No: at 88.64 the stock trades 37% above the GLS average fair value of 64.81 (data as of 16 Oct 2026), well beyond what trailing earnings, cash flow and book value support.
What is the Wheel Score of DSGX and what does it mean?
DSGX scores 69 out of 100 (Good). The Wheel Score blends the margin of safety (25 points), Piotroski health (20), the GLS moat (15), the option premium on offer (20) and trading stability (20) into one number that ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned. 80 and above is Prime, 65-79 Good, 50-64 Fair, under 50 Weak.
What is the GLS fair value for DSGX?
64.81 per share as of 16 Oct 2026 - the simple average of the 8 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does The Descartes Systems Group Inc. report earnings next?
The next earnings report is due on 2 Dec 2026 (after the close), 47 days from the data date of 16 Oct 2026. The Calendars page lists every upcoming report with its time of day.
Does DSGX have listed options, and how liquid are they?
Yes. The nightly snapshot found 172 listed contracts with 1,713 open interest across all expiries and implied volatility of 42% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.