Bottomline Technologies (EPAY:NAS) Fundamental Valuation Report

Fundamental Valuation Report

Bottomline Technologies(EPAY:NAS)

Technology:Software – Infrastructure

This Report was generated using the valuation tools available on For a free 30 day trial click here.

Close Price/Date
$47.76 (USD) 08/28/2020

Weighted Valuation
$48.53 (USD)

Overall Rating
Fairly valued to slightly Undervalued by 1.6%

Valuation Models Adjusted Book Value: $39.85 (USD)
Multiples: $40.46 (USD)
Valuation Methods This company is:
Cash Flow: Overvalued on a Cash Flow Valuation
Comparable Company: Overvalued on a Comparable Valuation
Asset: Overvalued on an Asset Valuation
According to Analyst consensus at $57.00 this stock is Undervalued

Company Overview (EPAY:NAS USD)

Price 47.76
Range 47.35 – 48.59
52 week 28.83 – 56.98
Open 48.33
Vol / Avg. 140445/250251
Mkt cap 2.1B
P/E 345.00
Div/yield 0.00/0.00
EPS -0.22
Shares 43.92M
Beta 1.26

Company Description

Bottomline Technologies Inc provides financial oriented solutions. It is a trusted and easy-to-use set of cloud-based digital banking, fraud prevention, payment, financial document, and healthcare solutions. Bottomline consists of four operating segments: Cloud Solutions segment provides customers predominately with SaaS technology offerings that facilitate electronic payment, electronic invoicing and spend management; Digital Banking segment provides solutions that are specifically designed for banking and financial institution customers; Payments and Transactional Documents segment is a supplier of software products that provide a range of financial business process management solutions; and Other segment consists of healthcare and cyber fraud and risk management operating segments.

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for EPAY:NAS

Using a discounted cash flow model we generated an intrinsic value of $29.32 (USD) for EPAY:NAS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

EPAY:NAS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $29.32 1% 5% 1% 5%
WACC (or Ke) 8.58 $36.60 $24.26
Terminal Growth Rate 3.00 $24.78 $35.86
Tax Rate 0.27 $31.56 $27.09
Cash Flow 121,818,059 $27.66 $30.99
Capital Expenditures -3,555,400 $29.28 $29.37
Long Term Debt 173,229,000 $29.52 $29.13

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $19.36 (USD) for EPAY:NAS. We also generated a valuation of $30.10 (USD) using other metrics and comparables.
The comparable companies were Verint Systems (VRNT:NAS), Zix (ZIXI:NAS), CSG Systems International (CSGS:NAS), J2 Global (JCOM:NAS) and NetScout Systems (NTCT:NAS).

Company EPAY:NAS End Date Value
Earnings/Share ($0.22) (USD)
Book Value/Share $8.72 (USD)
Sales/Share $10.55 (USD)
Cash Flow/Share $2.05 (USD)
EBITDA/Share $1.05 (USD)
Price Based on Comps Adjustment Factor (%)
$0.00 (USD) 0.0
$34.81 (USD) -36.4
$20.52 (USD) -27.1
$19.55 (USD) 18.2
$16.35 (USD) 0.0
0.00 PE Ratio 106.68 140.28 0.00 16.08 15.76 254.60
5.54 PB Ratio 3.99 2.46 10.81 3.60 2.14 0.96
4.58 PS Ratio 1.95 2.35 1.93 1.37 1.97 2.12
23.57 PCF Ratio 11.90 13.55 20.17 10.43 6.96 8.36
40.27 EV to EBITDA 15.50 19.30 21.30 8.87 7.33 20.70


Using a multiples approach we generated a valuation of  $40.46 (USD) for EPAY:NAS

Company EPAY:NAS End Date Value
Earnings/Share ($0.22) (USD)
Book Value/Share $8.72 (USD)
Sales/Share $10.55 (USD)
Cash Flow/Share $2.05 (USD)
EBITDA/Share $1.05 (USD)
Price Based on Comps Adjustment Factor
$0.00 (USD) 0
$41.18 (USD) 0
$39.73 (USD) 0
$39.58 (USD) 0
$41.35 (USD) 0
Ratios Ratio Average
PE Ratio 181.18
PB Ratio 4.72
PS Ratio 3.77
PCF Ratio 19.33
EV to EBITDA 39.20

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  EPAY:NAS for the last 10 years was  4.28

We ran the Adjusted Book Value for  EPAY:NAS and generated a book value of  $9.30 (USD)
By multiplying these we get an adjusted valuation of  $39.85 (USD)

Analyst Data

In the Stockcalc database there are 1 analysts that provide a valuation for EPAY:NAS. The 1 analysts have a concensus valuation for EPAY:NAS for 2021 of $57.00 (USD).

EPAY:NAS Bottomline Technologies

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
1 1 0 4.0000 Outperform 2020-8-27

Current Price: 47.76 USD

Analyst Consensus
USD Millions 2021 2022
Mean EPS 1.26 1.55
# EPS Analysts 2 2
Mean Revenue 469.90 532.80
# Revenue Analysts 2 2
Mean Target Price 57.00
Mean Cash Flow
Mean EBITDA 106.00 124.00
Mean Net Income 54.50 65.00
Mean Debt Outstanding
Mean Tax Rate 24.00 25.00
Mean Growth Rate
Mean Capital Expenditure

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.
The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).
The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.
We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.
Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.
With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.
If we have Analyst coverage for the company we use the consensus target price here.

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