Validea Motley Fool Strategy Daily Upgrade Report - 6/26/2025
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 26 2025
0mins
Should l Buy PEGA?
Source: NASDAQ.COM
Validea's Small-Cap Growth Investor Model: The model has upgraded PEGASYSTEMS INC (PEGA) from a 65% to a 72% rating based on its strong fundamentals and stock valuation, indicating growing interest in the company.
Company Overview: Pegasystems Inc. specializes in enterprise transformation through AI decision-making and workflow automation, offering a software portfolio that enhances customer experiences and operational efficiency across various markets.
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Analyst Views on PEGA
Wall Street analysts forecast PEGA stock price to rise
8 Analyst Rating
7 Buy
1 Hold
0 Sell
Strong Buy
Current: 40.590
Low
67.00
Averages
76.00
High
85.00
Current: 40.590
Low
67.00
Averages
76.00
High
85.00
About PEGA
Pegasystems Inc. is an enterprise transformation company that helps organizations Build for Change with enterprise artificial intelligence (AI) decisioning and workflow automation. It develops, markets, licenses, hosts and supports enterprise software that helps organizations make decisions and processes in real-time. Its platform for enterprise AI decisioning and workflow automation enables clients to personalize customer experiences, automate customer service, and streamline operations, business processes, and workflows. Its Pega Infinity is a software portfolio. Its applications and platform intersect with and encompass several software markets, including Customer Relationship Management, Digital Process Automation, Low-code application development platforms, Robotic Process Automation, Business Rules Management Systems, and Decision Management. Pega Platform, software for AI-powered workflow automation, boosts the efficiency of its clients’ processes and operational workflow.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
In the Face of the "SaaS Apocalypse," These 3 Companies Are Increasing Share Buybacks
Market Performance: The software sector has seen a significant decline, with the iShares Expanded Tech-Software Sector ETF down nearly 22% in 2026, while some companies are taking action to boost confidence through share buyback authorizations.
Company Highlights: Dynatrace has performed better than many software names, with shares down only about 14% in 2026, partly due to strong earnings reports that exceeded sales estimates and adjusted earnings per share.
Investor Sentiment: Despite some companies announcing substantial share buyback programs, investor confidence remains shaky, with concerns about the software industry's growth potential amid the rise of artificial intelligence tools.
Stock Recommendations: Analysts are suggesting that investors should be selective when considering investments in software stocks, as the market is facing challenges and the emergence of AI tools could disrupt traditional software development.
See More
Major Wall Street Rating Updates
- Apple Siri Upgrade Delay: Evercore ISI reiterates Apple as outperform, suggesting that reports of delays in Siri upgrades are overstated, with expectations for a multi-phase rollout of AI features this year, emphasizing the importance of privacy protection and seamless integration.
- Shopify Attractiveness Upgrade: TD Cowen upgrades Shopify from hold to buy, citing its strong quarterly performance and continued growth momentum as compelling reasons for investors to consider the stock, especially given its recent price decline.
- Fastly's Stellar Performance: William Blair upgrades Fastly from market perform to outperform following impressive earnings, driven by a significant increase in AI traffic contributions, indicating substantial growth potential in this emerging sector.
- MercadoLibre's Improved Competitive Landscape: JPMorgan upgrades MercadoLibre from neutral to overweight, noting a reduction in competitive pressures in the Latin American online marketplace, with expectations for sustained growth in the coming quarters.
See More
Pegasystems Shares Enter Oversold Territory
- Oversold Signal: Pegasystems Inc (Ticker: PEGA) saw its RSI drop to 27.0 during Wednesday's trading, indicating that its stock price, which hit a low of $35.89, has entered oversold territory, suggesting that recent heavy selling may be nearing exhaustion.
- Market Comparison: Compared to the current RSI of 51.7 for the S&P 500 ETF (SPY), PEGA's oversold condition may attract bullish investors looking for buying opportunities, reflecting a divergence in market sentiment.
- Historical Performance: PEGA's 52-week low is $29.835 and its high is $68.10, with the latest trade at $37.93, indicating potential opportunities for investors as the stock price fluctuates.
- Investor Strategy: Given the current oversold condition, investors may consider looking for entry points as PEGA's stock price rebounds, potentially capitalizing on the gains from a market recovery.
See More
Pegasystems Q4 2025 Earnings Highlights
- Significant Revenue Growth: Pegasystems reported a 17% year-over-year increase in total Annual Contract Value (ACV) for Q4 2025, with Pega Cloud ACV rising 33%, surpassing expectations and demonstrating the company's strong performance amid AI-driven market demand.
- Strong Cash Flow: Free cash flow increased by 45% year-over-year to $491 million, exceeding guidance by $51 million, indicating effective capital allocation and financial management, which enhances the company's capacity for future investments.
- Strategic Buyback Investment: The Board authorized an additional $1 billion in stock buyback capacity, reflecting confidence in the company's value, while after repaying $468 million in debt, cash and investments totaled $426 million, providing financial security for future growth.
- Optimistic 2026 Outlook: Management anticipates a 15% growth in both total ACV and revenue for 2026, with free cash flow projected to reach $575 million, showcasing strong confidence in sustained innovation and market expansion.
See More
Pegasystems (PEGA) Q4 2025 Earnings Transcript
See More
PEGASYSTEMS STOCK FALLS 12.2% FOLLOWING Q4 REPORT
- PEGAS Systems Shares Decline: PEGAS Systems shares have dropped by 12.2% following the release of their Q4 results.
- Impact of Q4 Results: The decline in share value indicates a negative market reaction to the company's fourth-quarter performance.
See More
In the Face of the "SaaS Apocalypse," These 3 Companies Are Increasing Share Buybacks
Market Performance: The software sector has seen a significant decline, with the iShares Expanded Tech-Software Sector ETF down nearly 22% in 2026, while some companies are taking action to boost confidence through share buyback authorizations.
Company Highlights: Dynatrace has performed better than many software names, with shares down only about 14% in 2026, partly due to strong earnings reports that exceeded sales estimates and adjusted earnings per share.
Investor Sentiment: Despite some companies announcing substantial share buyback programs, investor confidence remains shaky, with concerns about the software industry's growth potential amid the rise of artificial intelligence tools.
Stock Recommendations: Analysts are suggesting that investors should be selective when considering investments in software stocks, as the market is facing challenges and the emergence of AI tools could disrupt traditional software development.
See More
Major Wall Street Rating Updates
- Apple Siri Upgrade Delay: Evercore ISI reiterates Apple as outperform, suggesting that reports of delays in Siri upgrades are overstated, with expectations for a multi-phase rollout of AI features this year, emphasizing the importance of privacy protection and seamless integration.
- Shopify Attractiveness Upgrade: TD Cowen upgrades Shopify from hold to buy, citing its strong quarterly performance and continued growth momentum as compelling reasons for investors to consider the stock, especially given its recent price decline.
- Fastly's Stellar Performance: William Blair upgrades Fastly from market perform to outperform following impressive earnings, driven by a significant increase in AI traffic contributions, indicating substantial growth potential in this emerging sector.
- MercadoLibre's Improved Competitive Landscape: JPMorgan upgrades MercadoLibre from neutral to overweight, noting a reduction in competitive pressures in the Latin American online marketplace, with expectations for sustained growth in the coming quarters.
See More
Pegasystems Shares Enter Oversold Territory
- Oversold Signal: Pegasystems Inc (Ticker: PEGA) saw its RSI drop to 27.0 during Wednesday's trading, indicating that its stock price, which hit a low of $35.89, has entered oversold territory, suggesting that recent heavy selling may be nearing exhaustion.
- Market Comparison: Compared to the current RSI of 51.7 for the S&P 500 ETF (SPY), PEGA's oversold condition may attract bullish investors looking for buying opportunities, reflecting a divergence in market sentiment.
- Historical Performance: PEGA's 52-week low is $29.835 and its high is $68.10, with the latest trade at $37.93, indicating potential opportunities for investors as the stock price fluctuates.
- Investor Strategy: Given the current oversold condition, investors may consider looking for entry points as PEGA's stock price rebounds, potentially capitalizing on the gains from a market recovery.
See More
Pegasystems Q4 2025 Earnings Highlights
- Significant Revenue Growth: Pegasystems reported a 17% year-over-year increase in total Annual Contract Value (ACV) for Q4 2025, with Pega Cloud ACV rising 33%, surpassing expectations and demonstrating the company's strong performance amid AI-driven market demand.
- Strong Cash Flow: Free cash flow increased by 45% year-over-year to $491 million, exceeding guidance by $51 million, indicating effective capital allocation and financial management, which enhances the company's capacity for future investments.
- Strategic Buyback Investment: The Board authorized an additional $1 billion in stock buyback capacity, reflecting confidence in the company's value, while after repaying $468 million in debt, cash and investments totaled $426 million, providing financial security for future growth.
- Optimistic 2026 Outlook: Management anticipates a 15% growth in both total ACV and revenue for 2026, with free cash flow projected to reach $575 million, showcasing strong confidence in sustained innovation and market expansion.
See More
Pegasystems (PEGA) Q4 2025 Earnings Transcript
See More
PEGASYSTEMS STOCK FALLS 12.2% FOLLOWING Q4 REPORT
- PEGAS Systems Shares Decline: PEGAS Systems shares have dropped by 12.2% following the release of their Q4 results.
- Impact of Q4 Results: The decline in share value indicates a negative market reaction to the company's fourth-quarter performance.
See More
