Overview Dividends

(MGIC) Magic Software Enterprises - Ratings and Ratios

Exchange: NASDAQ • Country: Israel • Currency: USD • Type: Common Stock • ISIN: IL0010823123

Integration, Application, Development, Platform, Mobility

MGIC EPS (Earnings per Share)

EPS Growth (3Y CAGR): -60.28%
EPS Trend (3Y Correlation): -53.5%

MGIC Revenue

Revenue Growth (3Y CAGR): 1.91%
Revenue Trend (3Y Correlation): 30.9%

Description: MGIC Magic Software Enterprises August 27, 2025

Magic Software Enterprises Ltd (NASDAQ:MGIC) is an Israeli company operating in the Application Software sub-industry. The companys stock performance is characterized by a relatively stable trend, with short-term moving averages indicating a slight upward momentum. With a beta of 1.052, MGICs stock price tends to move in tandem with the overall market.

From a fundamental perspective, MGICs market capitalization stands at approximately $1.012 billion, with a price-to-earnings ratio of 25.32 and a forward P/E of 23.92. The companys return on equity (RoE) is 13.98%, indicating a relatively healthy profitability level. To further assess the companys performance, key drivers such as revenue growth, operating margins, and cash flow generation should be examined.

Some key performance indicators (KPIs) to monitor for MGIC include revenue growth rate, customer acquisition costs, and research and development (R&D) expenses as a percentage of revenue. The application software industry is highly competitive, and MGICs ability to innovate and expand its customer base will be crucial in driving future growth. Economic drivers such as global IT spending, cloud adoption rates, and the demand for digital transformation solutions will also impact MGICs performance.

In evaluating MGICs stock, its essential to consider the companys ability to generate cash flows, its competitive positioning, and the overall industry landscape. A thorough analysis of MGICs financial statements, management team, and industry trends will help investors make informed decisions. Key metrics to track include the companys debt-to-equity ratio, interest coverage ratio, and operating cash flow margin.

MGIC Stock Overview

Market Cap in USD	994m
Sub-Industry	Application Software
IPO / Inception	1991-08-28

MGIC Stock Ratings

Growth Rating	57.3%
Fundamental	70.3%
Dividend Rating	62.8%
Return 12m vs S&P 500	61.3%
Analyst Rating	3.50 of 5

MGIC Dividends

Dividend Yield 12m	4.15%
Yield on Cost 5y	7.98%
Annual Growth 5y	14.61%
Payout Consistency	56.9%
Payout Ratio	87.7%

MGIC Growth Ratios

Growth Correlation 3m	54%
Growth Correlation 12m	93.8%
Growth Correlation 5y	-25.1%
CAGR 5y	17.11%
CAGR/Max DD 3y (Calmar Ratio)	0.34
CAGR/Mean DD 3y (Pain Ratio)	0.75
Sharpe Ratio 12m	2.00
Alpha	78.36
Beta	0.926
Volatility	35.29%
Current Volume	7.7k
Average Volume 20d	27k
Stop Loss	20 (-3.3%)
Signal	0.11

Piotroski VR‑10 (Strict, 0-10) 7.5

Net Income (38.6m TTM) > 0 and > 6% of Revenue (6% = 35.1m TTM)

FCFTA 0.09 (>2.0%) and ΔFCFTA -7.15pp (YES ≥ +1.0pp, WARN ≥ +0.5pp)

NWC/Revenue 17.19% (prev 19.69%; Δ -2.51pp) (YES ≤20% & Δ≤-1pp; WARN ≤25% & Δ≤0 oder ≤40% & Δ≤-3pp)

CFO/TA 0.10 (>3.0%) and CFO 54.5m > Net Income 38.6m (YES >=105%, WARN >=100%)

Net Debt (8.01m) to EBITDA (84.9m) ratio: 0.09 <= 3.0 (WARN <= 3.5)

Current Ratio 1.61 (target 1.5–3.0; WARN 1.2–<1.5 or >3.0–5.0; CFO/TA gate active)

Outstanding Shares last Quarter (49.1m) change vs 12m ago 0.0% (target <= -2.0% for YES)

Gross Margin 28.17% (prev 28.28%; Δ -0.11pp) >=18% & Δ>=+0.5pp (WARN >=15% & Δ>=0)

Asset Turnover 109.4% (prev 100.0%; Δ 9.36pp) >=50% & Δ>=+2pp (WARN >=35% & Δ>=0)

Interest Coverage Ratio 11.18 (EBITDA TTM 84.9m / Interest Expense TTM 5.65m) >= 6 (WARN >= 3)

Altman Z'' 3.08

(A) 0.19 = (Total Current Assets 265.8m - Total Current Liabilities 165.3m) / Total Assets 541.7m

(B) 0.20 = Retained Earnings (Balance) 107.8m / Total Assets 541.7m

(D) 0.40 = Book Value of Equity 96.9m / Total Liabilities 239.4m

Total Rating: 3.08 = (6.56 * A) + (3.26 * B) + (6.72 * C) + (1.05 * D)

ValueRay F-Score (Strict, 0-100) 70.27

1. Piotroski 7.50pt = 2.50

2. FCF Yield 5.09% = 2.55

3. FCF Margin 8.73% = 2.18

4. Debt/Equity 0.35 = 2.44

5. Debt/Ebitda 0.09 = 2.49

6. ROIC - WACC (= 5.84)% = 7.30

7. RoE 13.98% = 1.17

8. Rev. Trend 30.88% = 2.32

9. EPS Trend -53.54% = -2.68

What is the price of MGIC shares?

As of November 01, 2025, the stock is trading at USD 20.68 with a total of 7,677 shares traded.
Over the past week, the price has changed by +2.17%, over one month by +2.79%, over three months by +1.31% and over the past year by +95.78%.

Is Magic Software Enterprises a good stock to buy?

Partly, yes. Based on ValueRay´s Fundamental Analyses, Magic Software Enterprises (NASDAQ:MGIC) is currently (November 2025) ok to buy, but has to be watched. It has a ValueRay Fundamental Rating of 70.27 and therefor a somewhat positive outlook according to the companies health.
Based on momentum, paid dividends and discounted-cash-flow analyses, the fair value of MGIC is around 22.10 USD . This means that MGIC is currently overvalued and has a potential downside of 6.87%.

Is MGIC a buy, sell or hold?

Magic Software Enterprises has received a consensus analysts rating of 3.50. Therefor, it is recommend to hold MGIC.

Strong Buy: 0
Buy: 1
Hold: 1
Sell: 0
Strong Sell: 0

What are the forecasts/targets for the MGIC price?

Issuer	Target	Up/Down from current
Wallstreet Target Price	18	-13%
Analysts Target Price	18	-13%
ValueRay Target Price	24.7	19.3%

MGIC Fundamental Data Overview October 27, 2025

Market Cap USD = 994.2m (994.2m USD * 1.0 USD.USD)
P/E Trailing = 25.6203
P/E Forward = 23.9234
P/S = 1.7008
P/B = 3.5904
P/EG = 1.08
Beta = 0.926
Revenue TTM = 584.5m USD
EBIT TTM = 63.2m USD
EBITDA TTM = 84.9m USD
Long Term Debt = 41.6m USD (from longTermDebt, last quarter)
Short Term Debt = 33.1m USD (from shortTermDebt, last quarter)
Debt = 98.0m USD (from shortLongTermDebtTotal, last quarter)
Net Debt = 8.01m USD (from netDebt column, last quarter)
Enterprise Value = 1.00b USD (994.2m + Debt 98.0m - CCE 90.0m)
Interest Coverage Ratio = 11.18 (Ebit TTM 63.2m / Interest Expense TTM 5.65m)
FCF Yield = 5.09% (FCF TTM 51.0m / Enterprise Value 1.00b)
FCF Margin = 8.73% (FCF TTM 51.0m / Revenue TTM 584.5m)
Net Margin = 6.61% (Net Income TTM 38.6m / Revenue TTM 584.5m)
Gross Margin = 28.17% ((Revenue TTM 584.5m - Cost of Revenue TTM 419.9m) / Revenue TTM)
Gross Margin QoQ = 27.94% (prev 27.58%)
Tobins Q-Ratio = 1.85 (Enterprise Value 1.00b / Total Assets 541.7m)
Interest Expense / Debt = 0.74% (Interest Expense 725.0k / Debt 98.0m)
Taxrate = 22.28% (3.32m / 14.9m)
NOPAT = 49.1m (EBIT 63.2m * (1 - 22.28%))
Current Ratio = 1.61 (Total Current Assets 265.8m / Total Current Liabilities 165.3m)
Debt / Equity = 0.35 (Debt 98.0m / totalStockholderEquity, last quarter 278.8m)
Debt / EBITDA = 0.09 (Net Debt 8.01m / EBITDA 84.9m)
Debt / FCF = 0.16 (Net Debt 8.01m / FCF TTM 51.0m)
Total Stockholder Equity = 276.2m (last 4 quarters mean from totalStockholderEquity)
RoA = 7.13% (Net Income 38.6m / Total Assets 541.7m)
RoE = 13.98% (Net Income TTM 38.6m / Total Stockholder Equity 276.2m)
RoCE = 19.87% (EBIT 63.2m / Capital Employed (Equity 276.2m + L.T.Debt 41.6m))
RoIC = 14.48% (NOPAT 49.1m / Invested Capital 339.1m)
WACC = 8.64% (E(994.2m)/V(1.09b) * Re(9.43%) + D(98.0m)/V(1.09b) * Rd(0.74%) * (1-Tc(0.22)))
Discount Rate = 9.43% (= CAPM, Blume Beta Adj.)
Shares Correlation 3-Years: 0.0 | Cagr: 0.0%
[DCF Debug] Terminal Value 77.01% ; FCFE base≈65.6m ; Y1≈80.6m ; Y5≈136.4m
Fair Price DCF = 36.83 (DCF Value 1.81b / Shares Outstanding 49.1m; 5y FCF grow 24.54% → 3.0% )
EPS Correlation: -53.54 | EPS CAGR: -60.28% | SUE: -4.0 | # QB: 0
Revenue Correlation: 30.88 | Revenue CAGR: 1.91% | SUE: -0.63 | # QB: 0

Additional Sources for MGIC Stock

News: Wall Street Journal | Benzinga | Yahoo Finance
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Fund Manager Positions: Dataroma | Stockcircle