Sector · Services-Prepackaged Software

What software companies are worth

18 listed software companies, compared on the measures that survive a look at the balance sheet. Every figure is built from filed accounts.

01

Where the sector trades

The median software companie trades on 23.3× EBITDA, across the 13 of 18 companies where EBITDA could be computed from filings. Median operating margin is 24.0%.

Median valuation measures for Software
MeasureSector medianCompanies measured
EV / EBITDA*23.3×13 of 18
EV / Sales*7.3×18 of 18
Net debt / EBITDA0.3×15 of 18
Return on capital12.2%18 of 18
Operating margin24.0%18 of 18
Free cash flow margin30.2%18 of 18
02

All software companies we cover

18 software companies compared on valuation measures
CompanyEV / EBITDAEV / SalesOperating marginFree cash flow marginReturn on capital
ADBEADOBE INC.10.9×4.4×36.6%41.4%47.9%
ADSKAutodesk, Inc.23.8×5.8×21.9%33.4%26.8%
CDNSCADENCE DESIGN SYSTEMS INC45.1×14.6×28.2%30.0%22.7%
CRMSalesforce, Inc.25.0×5.7×20.1%34.7%10.7%
CRWDCrowdStrike Holdings, Inc.—44.1×−6.1%27.2%−5.0%
DDOGDatadog, Inc.—22.7×−1.3%29.2%−1.0%
GENGen Digital Inc.9.8×5.1×42.4%30.5%19.3%
INTUINTUIT INC.17.5×4.7×26.1%32.5%17.9%
MSFTMICROSOFT CORP19.5×11.1×46.8%20.2%31.6%
NOWServiceNow, Inc.55.2×10.7×13.7%34.5%10.2%
ORCLORACLE CORP20.1×8.4×30.6%−35.2%12.0%
PLTRPalantir Technologies Inc.—91.1×31.6%46.9%14.5%
PTCPTC INC.14.2×5.6×35.9%31.3%20.1%
SNPSSYNOPSYS INC52.7×11.8×13.0%19.1%2.2%
TTWOTAKE TWO INTERACTIVE SOFTWARE INC—6.1×−1.6%6.9%−1.7%
TYLTYLER TECHNOLOGIES INC29.2×6.2×15.3%27.3%8.0%
VEEVVEEVA SYSTEMS INC—12.7×28.7%44.2%12.3%
XYZBlock, Inc.23.3×2.0×7.1%10.0%6.1%

* EV/EBITDA and EV/Sales move with share prices; these are a snapshot taken 2026-09-09. Margins and return on capital come from filed accounts and hold until the next reporting season. A dash means the measure could not be computed — most often because EBITDA was negative, or because enterprise value is not a meaningful concept for the company. Each company page says which.

03

Head to head

39 pairs from this sector compared side by side, with the sector median beside them.

MSFT vs ORCLMSFT vs PLTRCRWD vs MSFTCRM vs MSFTORCL vs PLTRCRWD vs ORCLCRM vs ORCLCRWD vs PLTRCRM vs PLTRCRM vs CRWDCRWD vs NOWCRM vs NOWADBE vs CRMADBE vs NOWINTU vs NOWADBE vs INTUADBE vs CDNSCDNS vs INTUDDOG vs INTUCDNS vs DDOGCDNS vs SNPSDDOG vs SNPSDDOG vs XYZSNPS vs XYZADSK vs SNPSADSK vs XYZVEEV vs XYZADSK vs VEEVADSK vs TTWOTTWO vs VEEVGEN vs VEEVGEN vs TTWOPTC vs TTWOGEN vs PTCGEN vs TYLPTC vs TYLPTC vs VEEVTTWO vs TYLTYL vs VEEV
04

How to read these

EV/EBITDA compares the whole cost of the business — equity plus debt, less cash — to its operating cash earnings. It is the multiple an acquirer thinks in, and unlike a P/E it is not distorted by how much debt a company carries.

Operating and free cash flow margins need no share price at all, so they are the fairest way to compare companies within a sector on the same day. A wide gap between the two usually means heavy capital spending.

Return on capital is operating income over debt plus equity. It says how much the business earns on the money tied up in it, which is a different question from whether the shares are cheap.

None of these is a recommendation, and a low multiple is not the same thing as a bargain — see the disclaimer. The company pages show the arithmetic and link to the filing behind every term.