Formula Systems (1985) Ltd. American Depositary Shares (FORTY)

FairStock Score: 54/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look for businesses with durable economics and a price that leaves room for error. Formula Systems is an IT services and software holding company with 19,337 employees and global operations. It is not a classic wide-moat franchise: services work is competitive, and in the second quarter of 2026 revenue was $782.4M while net income was $23.3M, a 2.97% margin. That is thin. FairStock's ROCE of 4.66% and ROE of 10.39% are modest, and the Piotroski F-Score of 3/9 and Altman Z-Score of 1.15 suggest weak financial quality and some balance-sheet risk, despite a debt-to-equity ratio of 0.40. Growth is the bright spot: the provided data shows 19.20% revenue growth and 84.51% profit growth, though the period is not named, and the PEG ratio of 0.28 looks inexpensive if that pace persists. At the 2026-10-13 close of $111.50, the P/E is 23.67 and P/B is 1.42. The Graham Number is $91.30, so the margin of safety is -22.12%; I am paying above a conservative asset-and-earnings estimate. EV/EBITDA of 7.13 is not demanding, the dividend yield is 2.24%, and beta of 0.18 is low. The 52-week range is $102.01 to $190.56, so the price is near the low. No Lynch category can be assigned because only 0 years of filed annual results are available, needing 3. Verdict: interesting growth and low beta, but thin margins, low returns on capital, and weak safety scores mean I would demand a wider discount before calling it a bargain.

In plain English: Formula Systems is a technology services company that helps other businesses with software and computer systems. It is growing sales and profits, but its profit margin is thin and some financial safety checks look weak. At $111.50, the stock does not look like a clear bargain based on its earnings and assets, though it pays a small dividend and carries only moderate debt.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer