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1. Company Snapshot

1.a. Company Description

CSG Systems International, Inc.provides revenue management and digital monetization, customer engagement, and payment solutions primarily to the communications industry in the Americas, Europe, the Middle East, Africa, and the Asia Pacific.It offers Advanced Convergent Platform, a private SaaS based platform; related solutions, including field force automation, analytics, electronic bill presentment, ACH, etc.


to the North American cable and satellite markets.The company also provides managed services; and professional services to implement, configure, and maintain its solutions, as well as licenses various solutions, such as mediation, partner management, rating, and charging.It serves retail, financial services, healthcare, insurance, and government entities.


The company was incorporated in 1994 and is headquartered in Greenwood Village, Colorado.

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1.b. Last Insights on CSGS

CSG Systems International's recent performance was driven by strong Q2 2025 earnings, beating estimates with $1.16 per share, and revenue growth. A quarterly dividend of $0.32 per share was approved, showcasing the company's commitment to shareholders. However, the acquisition by NEC Corporation for $80.70 per share, representing a 17.38% premium, triggered an investigation into the sale's fairness. The company's contract extension with Charter Communications and partnership with MoneyGram Haas F1 Team also contributed to its recent activity.

1.c. Company Highlights

2. CSG's Q2 2025 Earnings: A Strong Performance

CSG reported a record high revenue of $597 million in the first half of 2025, with a non-GAAP operating income of $106 million, or a non-GAAP adjusted operating margin of 19.5%. The company's EPS came in at $1.16, beating estimates of $1.04. Revenue growth was impacted by cautiousness in discretionary spending across industries, leading to a revised revenue growth expectation of 2% to 3% for the year. The company's non-GAAP adjusted free cash flow was $47 million, and they are raising their profitability guidance targets for the second quarter in a row.

Publication Date: Aug -23

📋 Highlights
  • Non-GAAP Operating Margin:: Achieved 19.5% in Q2 2025, a 250-basis-point improvement YoY.
  • Revenue Diversification:: 32% of total revenue now comes from non-cable/telecom industries, up from 31% in 2024.
  • Adjusted Free Cash Flow:: Generated $47 million in first-half 2025, the highest in a decade.
  • Top Customer Concentration:: Charter and Comcast account for 36% of total revenue.

Revenue Diversification and Customer Wins

CSG continues to diversify its revenue, with 32% of total revenue coming from industries outside of cable and telecom, up from 31% last year. The company signed new logo sales wins and deal expansions in financial services, insurance, and property management, as well as wins in the global telecom market. The top 2 customers, Charter and Comcast, now represent 36% of total revenue, indicating improving revenue concentration.

Valuation Metrics

CSG's current valuation metrics indicate a 'P/E Ratio' of 21.46, 'P/B Ratio' of 6.05, 'P/S Ratio' of 1.5, 'EV/EBITDA' of 7.83, 'Dividend Yield (%)' of 1.96, 'Free Cash Flow Yield (%)' of 8.42, 'ROIC (%)' of 11.31, and 'ROE (%)' of 28.63. The 'Net Debt / EBITDA' ratio is -0.55, indicating a healthy debt position. These metrics suggest that the market has priced in a certain level of growth, and the company's ability to deliver on its targets will be crucial in determining the stock's future performance.

Growth Prospects and AI Impact

CSG is well-positioned to benefit from its diversified revenue stream and its success in the global telecom space, particularly in the enterprise divisions of telecom operators. The company has a realistic view of the impact of AI and is focused on delivering ROI to clients. They believe AI can bring significant value to their clients and are investing in AI and data-driven solutions. As Brian Shepherd stated, the company is focused on delivering great value to its customers, and its ability to do so will drive its future growth prospects.

Outlook and Conclusion

Analysts estimate next year's revenue growth at 2.6%. With its strong financial performance, diversified revenue stream, and focus on delivering value to its customers, CSG is well-positioned to drive future growth. The company's commitment to delivering 2% to 6% pure organic revenue growth and diversifying revenue from new industry verticals to greater than 35% of total revenue by 2026 will be key to its future success.

3. NewsRoom

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CSG Systems International, Inc. (NASDAQ:CSGS) Receives Consensus Rating of “Hold” from Analysts

Dec -03

Source: defenseworld.net

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Campbell & CO Investment Adviser LLC Sells 7,499 Shares of CSG Systems International, Inc. $CSGS

Nov -17

Source: defenseworld.net

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CSG Systems International Approves Quarterly Dividend

Nov -14

Source: businesswire.com

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Why CSG Systems (CSGS) International Revenue Trends Deserve Your Attention

Nov -10

Source: zacks.com

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CSG Systems (CSGS) Q3 Earnings and Revenues Beat Estimates

Nov -05

Source: zacks.com

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CSG Systems International Reports Third Quarter 2025 Results

Nov -05

Source: businesswire.com

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CSG Systems (CSGS) Stock Jumps 14.4%: Will It Continue to Soar?

Oct -30

Source: zacks.com

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CORRECTING and REPLACING CSG Systems International Cancels its Upcoming Q3 2025 Earnings Presentation due to NEC Acquisition Announcement

Oct -30

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.77%)

6. Segments

Software as a Service and Related Solutions

Expected Growth: 4%

CSG Systems International's Software as a Service and Related Solutions segment growth is driven by increasing demand for cloud-based billing and customer management solutions, expansion into new markets, strategic partnerships, and growing adoption of digital transformation initiatives among communication service providers.

Software and Services

Expected Growth: 2.5%

CSG Systems International's Software and Services segment growth of 2.5% is driven by increasing demand for digital transformation, cloud-based solutions, and customer experience management. Additionally, the company's expansion into new markets, strategic partnerships, and investments in innovation are contributing to its growth.

Maintenance

Expected Growth: 1.5%

CSG Systems International's 1.5% maintenance growth is driven by increasing adoption of cloud-based billing and customer management solutions, expansion into new markets, and strategic partnerships. Additionally, the company's focus on digital transformation and innovation in the telecommunications industry contributes to its steady growth.

7. Detailed Products

CSG Ascendon

A cloud-based, digital monetization platform that enables companies to launch, manage, and monetize their digital services

CSG Mediation

A mediation platform that collects, processes, and delivers usage data from various network elements to support billing, charging, and analytics

CSG Interconnect

A wholesale billing and settlement platform that enables telecom operators to manage interconnect agreements, rate and bill traffic, and settle with other operators

CSG Wholesale

A platform that enables telecom operators to manage their wholesale business, including pricing, rating, and billing for wholesale services

CSG Customer Management

A customer management platform that enables telecom operators to manage customer relationships, including customer profiling, order management, and billing

8. CSG Systems International, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

CSG Systems International, Inc. operates in a niche market, providing business support systems (BSS) and operational support systems (OSS) to the communications industry. While there are some substitutes available, they are limited, and the company's products and services are highly specialized, reducing the threat of substitutes.

Bargaining Power Of Customers

CSG Systems International, Inc.'s customers are largely telecommunications companies, which have limited bargaining power due to the specialized nature of the company's products and services. Additionally, the company's long-term contracts and high switching costs also reduce the bargaining power of customers.

Bargaining Power Of Suppliers

CSG Systems International, Inc. has a diversified supplier base, and the company is not heavily dependent on any single supplier. Additionally, the company's suppliers are largely commodity providers, which reduces their bargaining power.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the BSS and OSS markets. The company's specialized products and services require significant investment in research and development, and new entrants would need to invest heavily to compete with CSG Systems International, Inc.

Intensity Of Rivalry

The BSS and OSS markets are moderately competitive, with a few established players competing for market share. However, CSG Systems International, Inc.'s strong brand reputation, long-term contracts, and high switching costs reduce the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 67.14%
Debt Cost 7.33%
Equity Weight 32.86%
Equity Cost 8.13%
WACC 7.59%
Leverage 204.31%

11. Quality Control: CSG Systems International, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
CSG Systems

A-Score: 5.9/10

Value: 4.1

Growth: 5.1

Quality: 6.0

Yield: 4.0

Momentum: 8.5

Volatility: 7.7

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Evertec

A-Score: 5.3/10

Value: 5.4

Growth: 6.3

Quality: 6.5

Yield: 1.0

Momentum: 5.0

Volatility: 7.3

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Couchbase

A-Score: 4.9/10

Value: 6.2

Growth: 5.1

Quality: 5.5

Yield: 0.0

Momentum: 9.0

Volatility: 3.3

1-Year Total Return ->

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AvePoint

A-Score: 4.5/10

Value: 3.0

Growth: 6.3

Quality: 6.0

Yield: 0.0

Momentum: 7.0

Volatility: 4.7

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Int'l Money Express

A-Score: 4.3/10

Value: 7.4

Growth: 7.7

Quality: 6.8

Yield: 0.0

Momentum: 2.0

Volatility: 2.0

1-Year Total Return ->

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Stock-Card
Sterling Check

A-Score: 3.4/10

Value: 3.2

Growth: 7.1

Quality: 2.7

Yield: 0.0

Momentum: 5.0

Volatility: 2.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

77.01$

Current Price

77.01$

Potential

-0.00%

Expected Cash-Flows