Iress Ltd shares: Buy, Hold or Sell?

Iress Ltd (ASX: IRE) shares are trading near an all-time high having gained over 2% on Wednesday to touch $12.02.

At these levels, Iress’ share price is back within striking distance of its all-time high of $12.35, which it set back in April.

While the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has found support today, having gained around 0.5% in afternoon trade, Iress’ strong performance is likely thanks to a well-received Investor Day which the company is holding.

Here are some highlights from today’s presentation:

  • Iress is a leading provider of information, trading, compliance, order managment, portfolio, wealth management and enterprise lending software tools
  • Iress offers investors a global presence with 17 global office locations
  • The group has a ten-year track record of dividend growth and its total shareholder return over the past decade has significantly outperformed the wider market
  • The company enjoys recurring revenues and strong cash conversion
  • Its business is diversified across products, markets and geographies. This diversification has increased significantly over the past decade
  • The company has market-leading positions including servicing 95% of sell-side brokers in Australia
  • Iress spends around $80 million per annum on product and development investment. This is key to staying ahead of the competition and entrenching its market-leading position

Buy, Hold or Sell?

In 2015 (the group operates on a calendar year basis) Iress achieved a 5% increase in revenues on a constant currency basis. The dividend was raised by 3%.

Based on its 2015 results, the stock is trading on a price-to-earnings multiple and dividend yield of around 34 times and 3.5% respectively.

That looks to be a pretty full valuation in my opinion and conservative investors would arguably wait for a more appealing entry point into this quality company.

The technology that's going to REPLACE the Internet is already here...

Iress is proof that there is money to be made from software...Dollar for dollar, insiders are calling it one of the biggest new markets in the history of modern business... NOW is the time to get in on the hush-hush industry that could be poised for growth of over 4,463%+ by 2020... And the 1 ASX stock that stands to grow YOUR money right alongside it! Simply click here to learn its name.

Motley Fool contributor Tim McArthur owns shares in Iress Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.