# Qualys (QLYS.US)

Canonical: https://gigainvestors.com/s/QLYS

Analysis as of: 2026-10-16T07:31:25.575Z. Financial observations: FY2009–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

A wonderful business at too high a price

Quality tests for Buy: pass (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: $192.65 per share; close as of 2026-10-15.

Estimated value: low $97.63 per share, central $137.05 per share, high $159.04 per share. Buy at or below the central value $137.05 per share. Valuation as of 2026-10-16T07:31:25.575Z; scenarios are not confidence intervals.

Expected annual return: 7.9% at the stated quote. About 7.9% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: pass

- 0 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 0

- Years with a net loss: 0

- Operating margin variation: 0.23×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.16×

- FY2018: 0.18×

- FY2019: 0.22×

- FY2020: 0.27×

- FY2021: 0.21×

- FY2022: 0.27×

- FY2023: 0.29×

- FY2024: 0.31×

- FY2025: 0.33×

- LTM to Jun 2026: 0.35×

### moat: pass

- Years with nonpositive invested capital use equity plus debt and leases; positive earnings with no positive capital are shown above 100%.

- ROIC, median of available years: 87.6%

- ROIC, second-lowest year: 47.4%

- Typical minus recent gross margin: -4.2 pp

- Typical gross margin (annual median): 78.7%

- Recent gross margin (lower of latest and 3-year median): 82.8%

- Years with nonpositive capital: 1

- Capital spending / revenue: 5.6%

- ROIC including acquisitions, ten-year median: 92.0%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2017: 67.6%

- FY2018: 79.7%

- FY2019: 47.4%

- FY2020: 88.2%

- FY2021: 96.0%

- FY2022: >100%

- FY2023: 34.9%

- FY2024: >100%

- FY2025: 87.0%

- LTM to Jun 2026: >100%

### economics: pass

- Owner earnings / net income, 5-yr: 1.08×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $757M

- Net income, five-year total: $703M

- Return on incremental invested capital: 175.7%

- Working capital / revenue, annual change: 0.0 pp

- Working capital / revenue, change between three-year averages: -0.2 pp

- Working capital / revenue, final three-year average: 24.9%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.14×

- FY2022: 1.10×

- FY2023: 1.12×

- FY2024: 1.04×

- FY2025: 1.05×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 79.7% vs 87.0%

- Per-share earnings: 0.50 to 4.65 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: -0.5%

- Ordinary dilution, 5-year annual growth: -2.2%

- Market cap gain: $3.6B

- Cumulative retained earnings: -$158M

- Diluted shares, 10-year annual growth: -0.5%

- Diluted shares, 5-year annual growth: -2.2%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 32.1%

- Per-share value change: $4.15

- Per-share value, starting three-year median: $0.50

- Per-share value, ending three-year median: $4.65

- Buybacks concentrated in cheaper years (correlation): 0.72

- Average buyback yield: 2.8%

- Buyback history: 10 years

- Debt-funded buybacks: No

- Acquisition spending: $34M

- Cumulative net income, 10 years: $980M

- ROIC, first three-year median: 79.7%

- ROIC, last three-year median: 87.0%

Chart: Earnings per share; fiscal year observations.

- FY2016: $0.50

- FY2017: $1.01

- FY2018: $1.37

- FY2019: $1.68

- FY2020: $2.25

- FY2021: $1.77

- FY2022: $2.74

- FY2023: $4.03

- FY2024: $4.65

- FY2025: $5.44

### accounting: pass

- stock compensation exceeds 15% of operating cash flow

- Sloan accruals: -10.1%

- Receivables to sales index (DSRI): 0.94×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 24.9%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.56×

- Accounting red flags: 1

- Goodwill and intangibles / equity: 0.02×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -12.0%

- FY2017: -12.5%

- FY2018: -12.0%

- FY2019: -13.5%

- FY2020: -12.0%

- FY2021: -15.9%

- FY2022: -13.0%

- FY2023: -11.4%

- FY2024: -7.2%

- FY2025: -10.1%

## Holders

- [Martin Whitman](https://gigainvestors.com/TA): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Price needs cash profits to grow 12% a year for ten years · sales +5.2%

Story as of 2026-10-16T09:59:27.988Z; price observation 2026-10-15.

Price needs cash profits to grow 12% a year for ten years

- 2025-05-07: Cybersecurity Firm Qualys' Earnings, Revenue, Guidance Top Views ([finance.yahoo.com](https://finance.yahoo.com/m/69cadcce-708b-3409-8564-e1f00ca19124/cybersecurity-firm-qualys%27.html))

- 2025-11-05: Qualys Stock Jumps. Cybersecurity Firm Posts Earnings Beat, Revenue Outlook Tops Views. ([finance.yahoo.com](https://finance.yahoo.com/m/0a84ea11-a9ec-329e-9c2a-bb47486071db/qualys-stock-jumps..html))

- 2026-05-06: Qualys Q1 Earnings Beat Estimates on Channel Strength and ETM Uptake ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/qualys-q1-earnings-beat-estimates-134900921.html))

- 2026-08-05: Qualys Q2 Earnings Beat on Channel Strength, FY26 Guidance Raised ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/qualys-q2-earnings-beat-channel-150000511.html))

### Sales · FY2025–2026

sales +5.2%; source https://www.sec.gov/Archives/edgar/data/1107843/000110784326000008/qlys-20251231.htm; observed 2026-02-20.

- FY2017: $231M 

- FY2018: $279M 

- FY2019: $322M 

- FY2020: $363M 

- FY2021: $411M 

- FY2022: $490M 

- FY2023: $554M 

- FY2024: $608M 

- FY2025: $669M 

- FY2026: $704M 

### Gross margin · FY2026

gross margin 83.5%; source https://www.sec.gov/Archives/edgar/data/1107843/000110784326000008/qlys-20251231.htm; observed 2026-02-20.

- FY2017: 77.7% 

- FY2018: 76.3% 

- FY2019: 78.4% 

- FY2020: 78.2% 

- FY2021: 78.2% 

- FY2022: 79.0% 

- FY2023: 80.6% 

- FY2024: 81.7% 

- FY2025: 82.8% 

- FY2026: 83.5% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in software infrastructure; annual sales are USD 669.1 million.

- Source: https://www.sec.gov/Archives/edgar/data/1107843/000110784326000008/qlys-20251231.htm (filed 2026-02-20); FY2025: revenue 669125000; grossProfit 554357000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); QLYS.US: Qualys, Inc. provides cloud-based platform delivering information technology (IT), security, and compliance solutions in the United States and internationally. The company provides Qualys Cloud Apps, which include cybersecurity asset management; enterprise TruRisk management; vulnerability management, detection, and response; total application security; patch management; custom assessment and remediation; multi-vector endpoint detection and response; policy audit; and file integrity monitoring. It offers TotalCloud, a cloud-native application protection platform, which include cloud workload protection, cloud detection and response, cloud security posture management, infrastructure as code, SaaS security posture management, cloud infrastructure and entitlement management, and Kubernetes and container security. In addition, the company markets and sells IT, security, and compliance solutions; offers Qualys' Enterprise TruRisk platform that enables customers to identify and manage IT and operational technology assets; collect and analyze IT security data; discover and prioritize vulnerabilities; quantify cyber risk exposure; recommend and implement remediation actions; and verify the implementation of such actions. Further, it offers asset tagging and management; reporting and dashboards; questionnaires and collaboration; remediation and workflow; big data correlation and analytics engine; and alerts and notifications. The company offers its solutions to enterprises, government entities, and small and medium-sized businesses in various industries, including education, financial services, government, healthcare, insurance, manufacturing, media, retail, technology, and utilities through its sales teams, as well as through security consulting organizations, managed service providers, resellers, cloud providers, and consulting firms. Qualys, Inc. was incorporated in 1999 and is headquartered in Foster City, California.

### Why customers stay

Margins ranged from 80.6% to 82.8% during 2023–25; it earns 87.6% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2023: grossProfit / revenue = 80.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2024: grossProfit / revenue = 81.7%.

- Source: https://www.sec.gov/Archives/edgar/data/1107843/000110784326000008/qlys-20251231.htm (filed 2026-02-20); FY2025: grossProfit / revenue = 82.8%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); 10-year return on capital observations [[2017,0.6755676846425451],[2018,0.7973180501242816],[2019,0.4739903819645219],[2020,0.8816674118392224],[2021,0.959979735598869],[2022,41.579362266385736],[2023,0.34861994319566053],[2024,1.1438309389548647],[2025,0.8699159450226425],[2026,1.0568854020639455]]; median 0.8757916784309324. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 3 of 10 years; bought back USD 183.4 million of shares.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2016: growth capex 6251000; upkeep 16994000; owner earnings 19224000. Growth capex / owner earnings = 0.3251664585934249.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2017: growth capex 6952097.638071366; upkeep 30865902.361928634; owner earnings 30210097.638071366. Growth capex / owner earnings = 0.23012496422090983.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2018: growth capex 0; upkeep 25112000; owner earnings 61096000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2019: growth capex 422000; upkeep 31201000; owner earnings 69336000. Growth capex / owner earnings = 0.006086304372908734.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2020: growth capex 0; upkeep 30037000; owner earnings 94380000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2021: growth capex 0; upkeep 25654000; owner earnings 81203000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2022: growth capex 0; upkeep 23981000; owner earnings 118633000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2023: growth capex 0; upkeep 8786000; owner earnings 169800000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2024: growth capex 0; upkeep 12334000; owner earnings 179859000. Growth capex / owner earnings = 0.

- Source: https://www.sec.gov/Archives/edgar/data/1107843/000110784326000008/qlys-20251231.htm (filed 2026-02-20); FY2025: growth capex 0; upkeep 4990000; owner earnings 207821000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); Dividend observations: [[2016,0],[2017,0],[2018,0],[2019,24831000],[2020,34461000],[2021,49994000],[2022,0],[2023,0],[2024,0],[2025,0]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://www.sec.gov/Archives/edgar/data/1107843/000110784326000008/qlys-20251231.htm (filed 2026-02-20); FY2025: cash repurchases 183425000 USD.

### Are managers owners

Insiders own 0.4% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); QLYS.US SharesStats.PercentInsiders = 0.44799999999999995 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits grow 12% yearly over ten years; actual growth was 30%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); Ten-year compound average after fade. Initial solved rate 0.2138877065576243. Price 192.65; FX 1; discount 0.1; same compounder ten-year fade to terminal 0.03. FY2015 owner earnings/share 0.4134848445359535 → FY2025 5.701067127534085. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $37.25 per share

- 2016-11: $33.20 per share

- 2016-12: $31.65 per share

- 2017-01: $35.90 per share

- 2017-02: $34.95 per share

- 2017-03: $37.90 per share

- 2017-04: $38.40 per share

- 2017-05: $42.00 per share

- 2017-06: $40.80 per share

- 2017-07: $40.15 per share

- 2017-08: $47.50 per share

- 2017-09: $51.80 per share

- 2017-10: $52.90 per share

- 2017-11: $58.90 per share

- 2017-12: $59.35 per share

- 2018-01: $62.50 per share

- 2018-02: $74.05 per share

- 2018-03: $72.75 per share

- 2018-04: $76.95 per share

- 2018-05: $76.95 per share

- 2018-06: $84.30 per share

- 2018-07: $87.10 per share

- 2018-08: $91.05 per share

- 2018-09: $89.10 per share

- 2018-10: $71.24 per share

- 2018-11: $78.76 per share

- 2018-12: $74.74 per share

- 2019-01: $86.53 per share

- 2019-02: $83.63 per share

- 2019-03: $82.74 per share

- 2019-04: $90.26 per share

- 2019-05: $88.61 per share

- 2019-06: $87.08 per share

- 2019-07: $86.56 per share

- 2019-08: $79.62 per share

- 2019-09: $75.57 per share

- 2019-10: $85.33 per share

- 2019-11: $87.51 per share

- 2019-12: $83.37 per share

- 2020-01: $85.74 per share

- 2020-02: $80.18 per share

- 2020-03: $86.99 per share

- 2020-04: $105.44 per share

- 2020-05: $115.32 per share

- 2020-06: $104.02 per share

- 2020-07: $123.48 per share

- 2020-08: $106.14 per share

- 2020-09: $98.01 per share

- 2020-10: $87.85 per share

- 2020-11: $95.01 per share

- 2020-12: $121.87 per share

- 2021-01: $138.47 per share

- 2021-02: $97.16 per share

- 2021-03: $104.78 per share

- 2021-04: $101.36 per share

- 2021-05: $96.68 per share

- 2021-06: $100.69 per share

- 2021-07: $101.56 per share

- 2021-08: $117.38 per share

- 2021-09: $111.29 per share

- 2021-10: $124.48 per share

- 2021-11: $130.29 per share

- 2021-12: $137.22 per share

- 2022-01: $128.14 per share

- 2022-02: $125.31 per share

- 2022-03: $142.41 per share

- 2022-04: $136.28 per share

- 2022-05: $130.68 per share

- 2022-06: $126.14 per share

- 2022-07: $122.32 per share

- 2022-08: $151.90 per share

- 2022-09: $139.39 per share

- 2022-10: $142.56 per share

- 2022-11: $123.32 per share

- 2022-12: $112.23 per share

- 2023-01: $115.36 per share

- 2023-02: $118.15 per share

- 2023-03: $130.02 per share

- 2023-04: $112.94 per share

- 2023-05: $126.26 per share

- 2023-06: $129.17 per share

- 2023-07: $138.80 per share

- 2023-08: $155.65 per share

- 2023-09: $152.55 per share

- 2023-10: $152.95 per share

- 2023-11: $184.84 per share

- 2023-12: $196.28 per share

- 2024-01: $189.17 per share

- 2024-02: $171.86 per share

- 2024-03: $166.87 per share

- 2024-04: $163.91 per share

- 2024-05: $140.62 per share

- 2024-06: $142.60 per share

- 2024-07: $149.14 per share

- 2024-08: $125.17 per share

- 2024-09: $128.46 per share

- 2024-10: $119.24 per share

- 2024-11: $153.60 per share

- 2024-12: $140.22 per share

- 2025-01: $139.41 per share

- 2025-02: $131.46 per share

- 2025-03: $125.93 per share

- 2025-04: $125.71 per share

- 2025-05: $138.55 per share

- 2025-06: $142.87 per share

- 2025-07: $133.07 per share

- 2025-08: $135.81 per share

- 2025-09: $132.33 per share

- 2025-10: $123.26 per share

- 2025-11: $140.85 per share

- 2025-12: $132.90 per share

- 2026-01: $131.90 per share

- 2026-02: $92.47 per share

- 2026-03: $87.85 per share

- 2026-04: $86.93 per share

- 2026-05: $109.29 per share

- 2026-06: $137.49 per share

- 2026-07: $144.75 per share

- 2026-08: $186.14 per share

- 2026-09: $187.20 per share

- 2026-10: $192.65 per share

## Annual estimated value (USD per share)

- FY2016: low $11.70 per share, central $12.45 per share, high $13.45 per share

- FY2017: low $13.20 per share, central $14.04 per share, high $15.16 per share

- FY2018: low $16.29 per share, central $17.60 per share, high $19.35 per share

- FY2019: low $18.23 per share, central $19.76 per share, high $21.81 per share

- FY2020: low $34.67 per share, central $45.86 per share, high $52.38 per share

- FY2021: low $39.94 per share, central $52.81 per share, high $60.31 per share

- FY2022: low $44.99 per share, central $60.87 per share, high $70.13 per share

- FY2023: low $62.89 per share, central $86.69 per share, high $99.96 per share

- FY2024: low $71.30 per share, central $99.48 per share, high $115.19 per share

- FY2025: low $90.77 per share, central $126.97 per share, high $147.16 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/1107843/000110784326000008/qlys-20251231.htm); period 2025-12-31, filed 2026-02-20.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.