Enghouse Systems (ENGH.TO) Buy, Sell or Hold

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Enghouse Systems (ENGH.TO)

16.91

-0.54 (3.09%)

as of Jul 30, 2026, 8:00:01 pm Market Open.

320 watching

Investor Insights

Jul 30, 2026, 12:00 am

This summary was created by AI, based on 7 opinions in the last 12 months.

Enghouse Systems (ENGH-T) has received mixed reviews from experts regarding its performance and potential. Many analysts are concerned about the broader software sector, highlighting significant challenges due to AI advancements, which have led to a 'SaaS-pocalypse' where valuations have drastically contracted. While the recent earnings report showed an EPS beat, overall revenue has declined, and future growth expectations are limited. The company's significant cash reserves raise questions about its capital allocation and shareholder return strategies. Some experts view the stock as a potential income investment due to its high dividend yield, yet caution remains regarding its declining business outlook and the risk of being a value trap.

Consensus

Bearish

Valuation

Undervalued

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BUY

Growth by acquisition. Did well in the era of cheap capital. With rising rates, acquisitions are more expensive. CEO has a good track record. Not a dog, it's just had a valuation correction. Good business model for safe and steady growth over time.

BUY ON WEAKNESS

Ecosystem that business is built in supported by M&A roll up model. Fundamentally, company has grown earnings meaningfully. Management is excellent. Waiting for share price to fall further before buying. Quality company that has been hit by market selloff.

BUY

Debated making a Top Pick today. A very good company, diversified. Recent quarter was weaker, more competitive pressure, acquisitions stonewalled. Sentiment has never been more negative. 10% free cashflow yield, over 200M on balance sheet. Tremendous value. Decent competitive position. He'd buy today.

BUY ON WEAKNESS

Growth by M&A software company - affected by higher interest rates. Believes company stock is expensive at the moment. Waiting for price to fall before buying.

BUY

Follows it. You can own only so many stocks. He targets $59.50. Similar to Constellation Software--enterprise software solutions. It did well as people worked from home in remote work. Then, they bought a company to do telemedicine. The stock has come down, but a decent runway lies ahead.

WAIT

Tuck-in acquisition story. No growth if no deals. Good story, but entry level is a bit high.

PAST TOP PICK

(A Top Pick Jun 08/21, Down 25%) Disappointing. Boom with pandemic has moderated. Software rollup story, but hasn't been able to find acquisitions. Huge amount of excess cash with more than 200M on balance sheet. Disciplined. Great company. Tons of value today.

HOLD

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. Insider selling could be part of tax payments and option exercise. Insiders own 22% of the company still. This is worth $400M. The CEO owns $260 alone. The recent sales are probably not a red flag in a material way. Unlock Premium - Try 5i Free

DON'T BUY

Believes capital better deployed in other software business models. Unable to determine long term value of business. Does not own shares.

TOP PICK

Organic growth plus acquisitions. Demand for its video product spiked during Covid. This demand has moderated, so revenue growth has been more challenging. Pandemic also squashed acquisitions, but this year looks better for those. Sitting on excess cash, which gives them optionality. Well positioned for a choppy environment. Inexpensive valuation. Free cashflow yield north of 5%. More of a niche product for call centres, rather than competing with the likes of ZM. Yield is 1.54%. (Analysts’ price target is $60.63)

BUY ON WEAKNESS

A lot of money going into the tech sector has pushed the valuation of the company too high. Growth through acquisition is problematic with over valued tech companies. If tech begins to sell off with interest rate increase, it might create good buying opportunity.

BUY

Valuation makes it cheapest it has been in a long time. Company trying to make acquisitions, but prices high in industry (telecommunications). Earnings are flat. For the time being, happy owning the company.

BUY ON WEAKNESS

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The company has seen a recent decline in price, making it attractive. There are also rumours that there could be a possible sale of the company. There is no news to account for the decline and fundamentals are intact. Unlock Premium - Try 5i Free

BUY ON WEAKNESS

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. No news that would account for the sharp decline today. It is buyable. The fizzling out of the buyout speculation and a broader sector based sell off is probably the reason. The company is fast-growing and there are still macro tailwinds. Unlock Premium - Try 5i Free

BUY

In Canada, tech stocks is the tuck-in acquisition model. However, tech PEs in Canada are steep now. ENGH's CEO may be waiting for a buying opportunity of a cheap company, but offering value; he has a good track record. Companies that do more of these deals drive revenues. ENGH offers reasonable long-term growth, particularly since it has underperformed in the past year.

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Enghouse Systems (ENGH.TO)