Can Strong Recurring Revenue Growth Push SPNS Stock Higher in 2025?

Sapiens International SPNS has shown resilience in 2025, with shares down only 2.3% year to date, outperforming the broader Zacks Computer & Technology sector’s decline of 14%. This relative strength can be attributed to SPNS’ consistent recurring revenues, expanding clientele and rich partner base that includes Microsoft MSFT and Cognizant CTSH. 

In 2024, recurring and reoccurring revenues from software products and post-production services increased 14.1% compared with 2023 to $390 million and accounted for 72% of revenues.

Sapiens’ initiative to strengthen its portfolio is noteworthy. The availability of StatementPro Multi-Company Operations enables all Sapiens Financial & Compliance (F&C) customers to streamline statutory reporting by performing the same actions across multiple statements and companies. This significantly reduces the administrative burden and increases productivity. Sapiens also announced the latest release of Sapiens IllustrationPro and Sapiens ApplicationPro, which offer greater automation, risk intelligence, and operational efficiency to agents and advisors.

These factors have helped Sapiens outperform peers, including Clearwater Analytics CWAN, shares of which have dropped 15.8% year to date. Clearwater offers accounting and reporting, performance measurement, compliance monitoring, planning and order management and risk analytics solutions for asset managers, insurance companies, large corporations and other asset owning institutions, including governments, endowments and foundations. Clearwater’s platform aggregates and normalizes data on more than $8.8 trillion of global invested assets for over 1,400 clients as of Dec. 31, 2024.

Sapiens International Corporation N.V. Price and Consensus

Sapiens International Corporation N.V. price-consensus-chart | Sapiens International Corporation N.V. Quote

SPNS Benefits From Rich Partner Base

Sapiens’ strategic emphasis on expanding its System Integrator ecosystem has proven successful. In 2024, SPNS strengthened its global partnerships with key players, such as Deloitte and LTIMindtree, while establishing new collaborations with Coforge and Cognizant to expand its regional footprint and delivery capabilities. 

Sapiens’ partnership with Microsoft is instrumental in driving their product innovation in the insurance industry. In January 2025, SPNS announced the availability of its SaaS solution in the Microsoft Azure marketplace, through which Microsoft Azure customers can purchase the SaaS solution.

A rich partner base is helping Sapiens win customers on a regular basis. Universal Life, a prominent life and health insurer in Cyprus, recently selected Sapiens CoreSuite for Life & Pensions to modernize its core insurance systems. This collaboration aims to replace outdated legacy systems, streamline operations, and accelerate innovation in policy administration, claims processing, and billing. Universal Life will also leverage Sapiens Cloud Services to enhance scalability and operational performance.

In March, Hiscox UK successfully went live with the Sapiens Insurance Platform, fully deployed on Sapiens Cloud. The migration from Microsoft Azure resulted in a 30% improvement in application speed, while the adoption of a modern API architecture enhances integration with best-of-breed solutions. This development bolsters Hiscox’s ability to deliver agile services across both its commercial and private client offerings.

Moreover, Pioneer Insurance and Surety Corporation in the Philippines chose the Sapiens Insurance Platform to advance its digital transformation. This expands Sapiens’ international footprint.

SPNS Offers Positive Guidance for 2025

For fiscal 2025, SPNS projects revenues between $553 million and $558 million. The Zacks Consensus Estimate for fiscal 2025 revenues is pegged at $555.81 million, suggesting a 2.48% increase from the prior-year quarter’s actual.

The Zacks Consensus Estimate for earnings is pegged at $1.46 per share, unchanged over the past 30 days. The estimate indicates a year-over-year decline of 1.35%.(Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

The Zacks Consensus Estimate for first-quarter 2025 revenues is pegged at $136.51 million, suggesting a 1.69% increase from the prior-year quarter’s actual.

The consensus mark for first-quarter 2025 earnings is pegged at 35 cents per share, unchanged over the past 30 days. The consensus estimate indicates a year-over-year decline of 2.78%.

Zacks Rank

SPNS currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

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This article originally published on Zacks Investment Research (zacks.com).

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