JKHY
Jack Henry & Associates, Inc.$164.20
Unclear
Target $165.87
Report: Mar 07, 2026Technology • Information Technology Services • Mature CompounderSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$164.20+1.0%
Rec: UnclearConviction: Medium
Entry Target
$127.59
(22% below current)
Fair Value
$165.87
(1% above current)
Stop Loss
$136.57
(17% below current)
Position Size
Starter
Time Horizon
Long-Term
Key Metrics
Live Snapshot
Market Data
52 Week High$193.39
52 Week Low$144.12
Avg. 3 Month Volume974K
Efficiency
LTM Gross Margin43.8%
LTM EBITDA Margin35.3%
LTM EBIT Margin26.9%
LTM Operating Margin25.9%
LTM ROA16.8%
LTM ROE23.8%
LTM ROIC62.6%
LTM ROCE26.1%
Capital Structure
Market Cap (MM)$11.4B
Enterprise Value (MM)$11.4B
Shares Outstanding72.27M
Total Debt (MM)$20.00M
Cash & Equivalents (MM)$28.22M
LTM Net Debt (MM)$-8.22M
LTM Net Debt/EBITDA-0.0x
Growth
TTM Rev. Growth8.4%
Last 3-Yr Rev. CAGR7.3%
Last 3-Yr EBITDA CAGR10.4%
Last 3-Yr EPS CAGR13.0%
Valuation
Street Target Price$203.75
LTM EV/Revenue4.6x
LTM EV/Gross Profit10.5x
LTM EV/EBIT17.2x
LTM EV/EBITDA13.1x
LTM P/E22.5x
LTM EV/FCF22.8x
LTM P/FCF22.8x
LTM P/TB7.5x
LTM P/B5.2x
Dividend Yield1.5%
Payout Ratio33.2%
Executive SummarySituation: Current price is $164.2 versus fair value $165.87 (1.0% expected return), and valuation confidence is stable. Debate: Bull case depends on Cloud-native platform penetration exceeding 80% of the client base. Bear case centers on Structural contraction of the addressable market due to community bank M&A. Conclusion: Recommendation is Unclear; maintain no position until reliability and catalyst evidence improve.
Bull Case
Jack Henry's unbundling strategy allows it to win high-margin digital and payment contracts even when the underlying core system is not replaced. Furthermore, the 62.6% ROIC and 1.4x FCF conversion provide a massive internal engine for compounding without the need for external financing.
Bear Case
Ongoing consolidation in the U.S. banking sector structurally shrinks the total addressable market, as evidenced by $28M in projected deconversion revenue for FY2026. Additionally, cloud-native competitors may erode market share in digital banking faster than Jack Henry can modernize its legacy core systems.
Key Catalysts
Mid-Term (6-18 months)Impact: High
Cloud-native platform penetration exceeding 80% of the client base. This validates the technology modernization narrative and reduces the du...
Near-Term (0-6 months)Impact: Moderate
Successful launch and adoption of the deposit-only cloud core. This product allows Jack Henry to compete for 'side-core' business at larger...
Long-Term (18+ months)Impact: Moderate
Jack Henry is relevant now because it has just completed a major leadership transition and achieved a debt-free balance sheet, providing a c...
Primary Risks
Concern: Medium
Structural contraction of the addressable market due to community bank M&A. When a client bank is acquired by a larger institution not using...
Concern: Medium
Moat erosion from cloud-native competitors like nCino or Q2. If these firms can offer superior digital experiences faster than Jack Henry ca...
Concern: Medium
The stewardship verdict is a Status Quo execution of the long-term strategic plan. The Governance Outcome Tree suggests: 1. Status Quo (80%...
Recent Activity
2026-02-03SEC Filing (8-K)
-7.27%Jack Henry & Associates, Inc. announced fiscal 2026 second quarter results on February 3, 2026
2023-08-16SEC Filing (8-K)
-7.03%Jack Henry & Associates, Inc. announced fiscal 2023 fourth quarter results on August 15, 2023
2023-02-08SEC Filing (8-K)
-9.32%Jack Henry & Associates, Inc. announced fiscal 2023 second quarter results on February 7, 2023
2022-08-17SEC Filing (8-K)
-6.42%Jack Henry & Associates, Inc. announced fiscal 2022 fourth quarter and full year results on August 16, 2022
Valuation Table
9.8/10Decision Grade
Scenario Range
$113
Bear
$148
Base
$177
Bull
$164