DSG is a $12.7B global logistics SaaS company. It has grown its sales and earnings at a 15% and 31% annualized rate over the past five years, respectively. Sales have grown nicely over the years, it has a high gross margin of 76%, net margins are 22%, and it generates decent free cash flows ofjust over $200M per year. It has almost no debt, a strong balance sheet, and it uses most of its free cash flows for strategic acquisitions. It is not cheap, trading at 45X forward earnings, but its strong track record of execution helps to support this premium valuation.
From a technical perspective, it does appear to be forming an 'inverse head and shoulders' since February, which many other tech names are also forming right now. It is a bullish setup, and if earnings come in nicely, we think this name can continue its run. We would be quite comfortable adding here as part of a long-term position.