Blackbaud Inc. Common Stock (BLKB)

FairStock Score: 63/100 — STEADY

Key Financials

Strengths

• Generates $167 million in annual free cash flow (10.1% yield on market cap)
• High return on equity of 108.5% demonstrating efficient capital deployment

Concerns

• Trades significantly above Graham Number ($10) with negative 263% margin of safety—limited downside protection
• High leverage at 13.16x debt-to-equity increases financial risk and interest expense burden
• Revenue declining at 2.3% year-over-year signals potential demand weakness or market share loss
• Altman Z-Score of 0.5 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Blackbaud Inc. Common Stock is a micro-cap technology company valued at $1.7 billion. The business generates $1.1 billion in annual revenue with a 3.3% net margin and $167 million in free cash flow. From a quality standpoint, Blackbaud shows solid Piotroski F-Score of 6/9 and distressed Altman Z-Score of 0.5 warrants caution. On valuation, the stock is reasonably priced at 15.3x earnings, with trades far above its Graham Number ($10) with no margin of safety. Growth dynamics show revenue growing at -2.3% and profit growth of 111.1%. Our composite FairStock Score of 63/100 reflects above-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $167 million in annual free cash flow (10.1% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Elevated leverage at 13.2x D/E means rising interest rates or revenue weakness could strain debt covenants and force asset sales at distressed prices. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer