One-glance verdict
Undervalued
$282.24 our estimate vs market $143.84
Wall Street consensus: $189.72 (-32.8% lower than our fair-value estimate)
49% below our estimate, below the bear case
Fundamentals snapshot
Jack Henry & Associates, Inc.
JKHY · NMS · Technology · Information Technology Services
Current price
$143.84
52-week range
$121.04 - $193.39
Market cap
$10.08B
Balance sheet
Healthy
117.88x Strong cushion
Net debt $65.77M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 7.1% last year.
- Reward Returns 24.0% on equity, ahead of 60% of its peers.
- Reward Free cash flow was positive in 10/10 years.
- Risk Operating margin compressed from 23.1% to 22.5% over 3 years.
What this company does
Jack Henry & Associates, Inc.
Jack Henry & Associates provides the essential software that thousands of smaller banks and credit unions use to run their daily operations, like managing customer accounts and processing payments. The company makes most of its money from long-term contracts for these critical services, creating predictable recurring revenue (income that is highly likely to continue in the future). Because it is very expensive and difficult for a bank to switch this core software, Jack Henry tends to keep its customers for a very long time.
How the company got here
Jack Henry & Associates was started in 1976 by Jack Henry and Jerry Hall in a rented space in an engine repair shop. They saw that only large banks could afford the computer systems needed to manage their operations and wanted to create software for smaller community banks. The company went public in 1985, selling shares on the NASDAQ stock exchange. Over the years, it has grown by acquiring other companies to expand its offerings, notably buying Symitar in 2000 to begin serving credit unions.
What it actually does
Jack Henry provides the essential technology that banks and credit unions use to run their daily operations. Think of it as the digital backbone for financial institutions, handling everything from processing deposits and loans to enabling online and mobile banking. The company primarily serves smaller community and regional banks and credit unions across the United States. Their systems help these institutions manage customer accounts, move money securely, and offer modern digital services to their customers.
Core
This is the foundational part of Jack Henry's business, providing the core information processing platforms for banks and credit unions. This system is the central hub for a financial institution, managing essential tasks like processing deposits and loans and keeping track of all customer account information. Banks and credit unions pay Jack Henry for these critical, integrated software applications that are required for their basic operations. This segment, along with Complementary, forms the vast majority of the company's business.
Payments
The Payments segment provides the tools and services that allow financial institutions and their customers to move money securely and conveniently. This includes everything from processing ATM, debit, and credit card transactions to enabling online and mobile bill payments and remote check deposits. Customers of this segment are the banks and credit unions who pay for these services to offer modern payment options to their account holders. This is a smaller, but still significant, part of Jack Henry's overall revenue.
Complementary
This segment offers a wide range of additional software and services that enhance the core and payments offerings. This can include digital banking platforms, tools for opening accounts online, and software to detect fraud and manage risk. Financial institutions purchase these services to add more features and capabilities for their customers and to improve their own operations. Alongside the Core segment, this is one of the largest parts of the company, making up nearly half of its revenue.
Corporate Services
This part of the business provides the necessary hardware and other related products that financial institutions need to run Jack Henry's software. This can include servers and check scanners from brands like IBM, Dell, and Canon. Banks and credit unions purchase this equipment to support the technology systems they get from the company's other segments. This is the smallest of Jack Henry's business lines.
What management is betting on now
The company is focused on helping its client banks and credit unions operate more efficiently and grow by attracting more customers and expanding their services, especially for small and medium-sized businesses. A major priority is investing in technology, including cloud-based platforms and artificial intelligence, to improve digital banking and guard against fraud. They are also concentrating on enhancing payment services, such as real-time payments and digital card issuance, to meet modern consumer expectations. This strategy aims to deepen relationships with existing clients by providing an all-in-one ecosystem of financial technology.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2025 Q1
$104.09M
FY2025 Q2
$72.98M
FY2025 Q3
$96.13M
FY2025 Q4
$314.94M
FY2026 Q1
$111.71M
FY2026 Q2
$131.45M
FY2026 Q3
$169.51M
FY2026 Q4
$282.19M
Revenue
$644.02M
Net income
$111.23M
Diluted EPS
1.58
Operating cash flow
$302.67M
Free cash flow
$282.19M
Fetching…
Sources
Revenue
$636.25M
Net income
$122.89M
Diluted EPS
1.71
Operating cash flow
$186.03M
Free cash flow
$169.51M
Fetching…
Sources
Revenue
$619.33M
Net income
$124.67M
Diluted EPS
1.72
Operating cash flow
$152.66M
Free cash flow
$131.45M
Fetching…
Sources
Revenue
$644.74M
Net income
$143.99M
Diluted EPS
1.97
Operating cash flow
$120.59M
Free cash flow
$111.71M
Fetching…
Sources
Revenue
$615.37M
Net income
$127.60M
Diluted EPS
1.75
Operating cash flow
$327.11M
Free cash flow
$314.94M
Fetching…
Sources
Revenue
$585.09M
Net income
$111.11M
Diluted EPS
1.52
Operating cash flow
$107.85M
Free cash flow
$96.13M
Fetching…
Sources
Revenue
$573.85M
Net income
$97.84M
Diluted EPS
1.34
Operating cash flow
$89.65M
Free cash flow
$72.98M
Fetching…
Sources
Revenue
$600.98M
Net income
$119.19M
Diluted EPS
1.63
Operating cash flow
$116.90M
Free cash flow
$104.09M
Fetching…
Sources
Is it cheap or expensive?
Fair value $282.24 vs current price $143.84
Wall Street consensus is the average analyst price target: $189.72 (-32.8% lower than our fair-value estimate).
Our most-likely fair value is $282.24 a share — about 96.2% above today's price of $143.84, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net debt $65.8M. Interest coverage 117.9x.
Net debt
$65.77M
Interest coverage
117.88x
Jack Henry & Associates, Inc.'s profit covers its interest bill about 117.9 times over. which is stronger than every peer shown here.
Healthy
Worse cushion
Baseline
Better cushion
JKHY
BASELINE
Jack Henry & Associates, Inc.
Total debt $77.82M Interest coverage 117.88x This is the baseline the peer rows are being compared against.
Total debt — Interest coverage 3.72x -97% vs JKHY Carries about 31.7x less debt cushion than JKHY.
Total debt $21.26B Interest coverage 4.50x -96% vs JKHY Carries about 26.2x less debt cushion than JKHY.
Total debt $23.56B Interest coverage 2.27x -98% vs JKHY Carries about 52.0x less debt cushion than JKHY.
Total debt $40.93M Interest coverage 8.11x -93% vs JKHY Carries about 14.5x less debt cushion than JKHY.
Total debt $3.52B Interest coverage 11.63x -90% vs JKHY Carries about 10.1x less debt cushion than JKHY.
What you should know
The case for and against JKHY
3 Rewards
1 Risk
Rewards
-
Revenue grew 7.1% last year.
-
Returns 24.0% on equity, ahead of 60% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Operating margin compressed from 23.1% to 22.5% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
20.61x
Forward P/E
18.20x
P/B
4.91x
P/S
3.96x
EV/EBITDA
14.46x
PEG ratio
1.74x
Profitability
How much profit each dollar creates
Gross margin
43.9%
Operating margin
22.5%
Net margin
19.8%
ROE
24.0%
ROA
13.0%
Health
Liquidity and balance-sheet strength
Debt / equity
0.04x
Current ratio
1.17x
Quick ratio
0.73x
Total debt
$77.82M
Total cash
$12.06M
Growth
How the business has been compounding
Revenue TTM
$2.54B
Revenue 5Y CAGR
7.0%
EPS TTM
6.98
EPS 5Y CAGR
11.6%
Cash flow
How much cash the business throws off
Operating CF TTM
$761.96M
Free CF TTM
$694.86M
FCF margin
27.3%
Dividend
Shareholder payout
Yield
1.7%
Payout ratio
34.1%
Last ex-div date
2026-09-04