Donnelley Financial Solutions, Inc. (NYSE: DFIN)

Sector: Technology Industry: Software - Application CIK: 0001669811
Market Cap 1.20 Bn
P/B 3.17
P/E 37.14
P/S 1.57
ROIC (Qtr) 15.15
Div Yield % 0.00
Rev 1y % (Qtr) 10.36
Total Debt (Qtr) 178.50 Mn
Debt/Equity (Qtr) 0.47
Add ratio to table...

About

Donnelley Financial Solutions, Inc., or DFIN, is a renowned global provider of financial regulatory and compliance solutions. The company, which operates under the ticker symbol DFIN and is publicly traded, specializes in delivering software and technology-enabled services to various clients, including public and private companies, mutual funds, and other regulated investment firms. DFIN's offerings cater to the regulatory and compliance needs of its clients in the capital markets and investment companies segments. DFIN's primary business activities...

Read more

Investment thesis

Bull case

  • Strong operating cash flow of 164.90M provides robust 0.92x coverage of total debt 178.50M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 24.50M provide 2.53x coverage of short-term debt 9.70M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 164.90M provides exceptional 12.78x coverage of interest expenses 12.90M, showing strong debt service capability.
  • Robust free cash flow of 107.80M exceeds capital expenditure of 57.10M by 1.89x, indicating strong organic growth funding capability.
  • Retained earnings of 560.90M provide full 3.32x coverage of long-term debt 168.80M, indicating strong internal capital position.

Bear case

  • Operating cash flow of 164.90M barely covers its investment activities of (57M), with a coverage ratio of -2.89, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • High depreciation of 66.10M relative to operating cash flow of 164.90M, which is 0.40x suggests significant maintenance capital requirements affecting free cash flow.
  • Operating earnings of 56M show weak coverage of depreciation charges of 66.10M, with a 0.85 ratio indicating high capital intensity and potential reinvestment needs.
  • Retained earnings of 560.90M provide limited buffer against comprehensive income items of (19.60M), which is -28.62x, indicating elevated exposure to market risks.
  • Operating cash flow of 164.90M is outpaced by equity issuance of (183.10M) (-0.90 ratio), indicating concerning reliance on equity markets for funding operations.

Segments Breakdown of Revenue (2025)

Product and Service Breakdown of Revenue (2025)

Peer comparison

Companies in the Software - Application
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 SAP Sap Se 235.43 Bn 27.31 5.44 9.50 Bn
2 SHOP Shopify Inc. 147.12 Bn 119.52 12.73 0.19 Bn
3 UBER Uber Technologies, Inc 147.10 Bn 14.63 2.83 12.08 Bn
4 CRM Salesforce, Inc. 122.20 Bn 594.48 15.45 11.14 Bn
5 INTU Intuit Inc. 113.93 Bn 178.01 32.63 6.78 Bn
6 ADBE Adobe Inc. 111.00 Bn 15.57 4.67 6.65 Bn
7 NOW ServiceNow, Inc. 109.54 Bn 62.67 8.25 2.40 Bn
8 ADP Automatic Data Processing Inc 86.44 Bn 20.41 4.07 4.37 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.68 2.08
EV to Cash from Ops. EV/CFO 8.15 11.38
EV to Debt EV to Debt 7.53 47.67
EV to EBIT EV/EBIT 23.99 6.78
EV to EBITDA EV/EBITDA 6.48 7.15
EV to Free Cash Flow [EV/FCF] EV/FCF 12.46 14.44
EV to Market Cap EV to Market Cap 1.12 -8.88
EV to Revenue EV/Rev 1.75 4.04
Price to Book Value [P/B] P/B 3.17 3.65
Price to Earnings [P/E] P/E 37.14 -117.75
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 -4.05
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 4.38
Dividend per Basic Share Div per Share (Qtr) 0.00 0.15
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 2.48
Interest Coverage Int. cover (Qtr) 4.34 -43.57
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -6.73 -222.46
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -57.24 281.53
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.78
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -58.70 -327.55
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 0.53 30.09
EBIT Growth (1y) % EBIT 1y % (Qtr) -59.42 -213.00
EBT Growth (1y) % EBT 1y % (Qtr) -65.55 -86.84
EPS Growth (1y) % EPS 1y % (Qtr) -62.66 108.58
FCF Growth (1y) % FCF 1y % (Qtr) -8.33 6.29
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 0.54 94.58
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.96 0.58
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 0.12 3.78
Current Ratio Curr Ratio (Qtr) 1.06 8.27
Debt to Equity Ratio Debt/Equity (Qtr) 0.47 0.14
Interest Cover Ratio Int Coverage (Qtr) 4.34 -43.57
Times Interest Earned Times Interest Earned (Qtr) 4.34 -43.57
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 15.90 -105.03
EBIT Margin % EBIT Margin % (Qtr) 7.30 -130.16
EBT Margin % EBT Margin % (Qtr) 5.62 -121.17
Gross Margin % Gross Margin % (Qtr) 63.40 58.37
Net Profit Margin % Net Margin % (Qtr) 4.20 -126.13