JKHY
Jack Henry & Associates
Recurring SaaS
★ Quality 74/100Price today
$147.64
what the market pays
Worth
$228.33
calculated cycle value
Price is 35% below its value
charlieapp.co
Unusually large discount. A gap this wide usually means the market is pricing in a risk (AI disruption, for example) that the model does not penalise. A contrarian opportunity: high upside, but high risk — not an obvious one.
Price vs Intrinsic Value
The line is the price month by month; the green band marks when it's undervalued (−20% off value). When the price drops in there, the discount is real, not opinion.
Where does the value come from?
Software and subscriptions
$228.33
per share
How it's calculated
Jack Henry & Associates — high assisted route (2026-06-07). Review note.
Total calculated value
business + cash
How many times the cash flow
Recurring SaaS · vs 26 peers
You pay 18x times this business's cash flow; its sector median is 21.9x.
55% below what Charlie thinks it's worth (27.9x) — that gap is your safety margin.
Why Undervalued?
Its free cash flow is $8.18/share × 27.9x multiplier = $228.33 in intrinsic value. Today's price of $147.64 is 55% below that value — there's a real safety margin to enter.
The price is 35% below the calculated value. There's a real safety margin.
The model asks for a discount to absorb estimate errors. That cushion is here.
If the business disappoints a little, the price should hold near $182.66.
At what price would buying make sense?
Entry zones
🟢 Undervalued
≤$182.66
-20% off Value
🟡 Discounted
≤$216.91
-5% off Value
🟢 Today
$147.64
+55% Valor
Undervalued
Today's price offers a real discount to the calculated value. For the long run, this is the kind of entry that builds wealth.
“Price is what you pay. Value is what you get.”
— Warren Buffett
Model updated · July 2026
The business
The operating system for 7,500 banks that nobody dares to replace.
Jack Henry provides the core banking software, payment processing, and digital banking for more than 7,500 community banks and credit unions in the U.S. It charges through recurring contracts and per transaction processed: every time someone uses their card or pays a bill, JKHY collects. Revenue of $2.4B, two-thirds recurring.
Switching your core banking system is like changing a patient's heart while they're awake: expensive, risky, and slow. Those switching costs keep the customer tied in for decades. The moat is real, but it's not a monopoly — it competes against Fiserv and FIS, giants with more scale.
Revenue history
From $1.8B to $2.4B in 4 years. The business grows steadily.
Where each $100 of sales goes
Revenue $2.4B · FY2025
Of every $100 in sales, $81 goes to costs and operations; $19 is left as net profit (19% margin).
Catalysts and risks
Cloud migration (Jack Henry platform) that raises margins from the current 43%.
Growth in real-time payments (FedNow), where JKHY connects thousands of small banks.
Consistent buybacks with $0.6B in FCF and a balance sheet with no net debt.
Bank consolidation: each merger of small banks eliminates a customer.
Fiserv and FIS have more scale and can subsidize prices to win contracts.
8% growth doesn't justify a 27.9x multiple if the cloud migration falls behind.
Charlie's note
“A boring business that prints cash: I like it. The problem is the price — paying 28 times cash flow for 8% growth leaves little room for error. Good business, impatient valuation.”
Analysis · June 2026
So when would be a good price for Jack Henry & Associates?
Today it trades below what we calculate. If you want us to tell you when that changes —or when the value itself moves because the company reported— we will email you.
🔔 Email meFree · no card
Charlie informs, it doesn't advise. No information should be taken as a recommendation to buy or sell.