VERTEX INC - CLASS A (VERX) Stock Fundamental Analysis
NASDAQ:VERX - Nasdaq - US92538J1060 - Common Stock - Currency: USD
VERX gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 282 industry peers in the Software industry. Both the profitability and financial health of VERX have multiple concerns. VERX is valued quite expensively, but it does show have an excellent growth rating.
1. Profitability
1.1 Basic Checks
VERX had positive earnings in the past year.
VERX had a positive operating cash flow in the past year.
In the past 5 years VERX always reported negative net income.
In the past 5 years VERX always reported a positive cash flow from operatings.
1.2 Ratios
VERX has a Return On Assets (-3.84%) which is comparable to the rest of the industry.
VERX's Return On Equity of -22.09% is in line compared to the rest of the industry. VERX outperforms 41.49% of its industry peers.
VERX has a better Return On Invested Capital (0.53%) than 63.48% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -3.84% | ||
| ROE | -22.09% | ||
| ROIC | 0.53% |
ROA(3y)-2.65%
ROA(5y)-4.32%
ROE(3y)-13.31%
ROE(5y)-14.67%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
VERX's Operating Margin of 0.62% is fine compared to the rest of the industry. VERX outperforms 62.41% of its industry peers.
VERX has a Gross Margin (64.53%) which is in line with its industry peers.
In the last couple of years the Gross Margin of VERX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 0.62% | ||
| PM (TTM) | N/A | ||
| GM | 64.53% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.03%
GM growth 5Y-0.54%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), VERX is destroying value.
The number of shares outstanding for VERX has been increased compared to 1 year ago.
The number of shares outstanding for VERX has been increased compared to 5 years ago.
The debt/assets ratio for VERX is higher compared to a year ago.
2.2 Solvency
VERX has an Altman-Z score of 4.02. This indicates that VERX is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.02, VERX is in the better half of the industry, outperforming 63.48% of the companies in the same industry.
A Debt/Equity ratio of 1.67 is on the high side and indicates that VERX has dependencies on debt financing.
The Debt to Equity ratio of VERX (1.67) is worse than 79.08% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.67 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 4.02 |
ROIC/WACC0.05
WACC10.99%
2.3 Liquidity
A Current Ratio of 0.98 indicates that VERX may have some problems paying its short term obligations.
VERX has a worse Current ratio (0.98) than 75.53% of its industry peers.
VERX has a Quick Ratio of 0.98. This is a bad value and indicates that VERX is not financially healthy enough and could expect problems in meeting its short term obligations.
VERX has a Quick ratio of 0.98. This is in the lower half of the industry: VERX underperforms 74.47% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.98 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 32.61% over the past year.
VERX shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 25.31% yearly.
VERX shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 15.20%.
Measured over the past years, VERX shows a quite strong growth in Revenue. The Revenue has been growing by 15.71% on average per year.
EPS 1Y (TTM)32.61%
EPS 3Y25.31%
EPS 5YN/A
EPS Q2Q%0%
Revenue 1Y (TTM)15.2%
Revenue growth 3Y16.15%
Revenue growth 5Y15.71%
Sales Q2Q%12.94%
3.2 Future
VERX is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 23.03% yearly.
VERX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 15.87% yearly.
EPS Next Y5.87%
EPS Next 2Y14.97%
EPS Next 3Y24.47%
EPS Next 5Y23.03%
Revenue Next Year14.76%
Revenue Next 2Y14.66%
Revenue Next 3Y15.59%
Revenue Next 5Y15.87%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
VERX is valuated quite expensively with a Price/Earnings ratio of 57.92.
VERX's Price/Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Earnings ratio of 27.53, VERX is valued quite expensively.
A Price/Forward Earnings ratio of 43.82 indicates a quite expensive valuation of VERX.
The rest of the industry has a similar Price/Forward Earnings ratio as VERX.
VERX's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 36.71.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 57.92 | ||
| Fwd PE | 43.82 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VERX indicates a somewhat cheap valuation: VERX is cheaper than 61.70% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 63.29 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates VERX does not grow enough to justify the current Price/Earnings ratio.
VERX's earnings are expected to grow with 24.47% in the coming years. This may justify a more expensive valuation.
PEG (NY)9.86
PEG (5Y)N/A
EPS Next 2Y14.97%
EPS Next 3Y24.47%
5. Dividend
5.1 Amount
VERX does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
35.33
+0.47 (+1.35%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners109.63%
Inst Owner Change0.04%
Ins Owners6.35%
Ins Owner Change26.99%
Market Cap5.60B
Analysts79.09
Price Target48.22 (36.48%)
Short Float %8.91%
Short Ratio4.34
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.16%
Min EPS beat(2)7.01%
Max EPS beat(2)9.3%
EPS beat(4)4
Avg EPS beat(4)11.4%
Min EPS beat(4)7.01%
Max EPS beat(4)15.34%
EPS beat(8)7
Avg EPS beat(8)9.6%
EPS beat(12)11
Avg EPS beat(12)12.37%
EPS beat(16)15
Avg EPS beat(16)21.26%
Revenue beat(2)0
Avg Revenue beat(2)-1.5%
Min Revenue beat(2)-1.91%
Max Revenue beat(2)-1.09%
Revenue beat(4)1
Avg Revenue beat(4)-0.97%
Min Revenue beat(4)-1.91%
Max Revenue beat(4)0.84%
Revenue beat(8)3
Avg Revenue beat(8)-0.04%
Revenue beat(12)6
Avg Revenue beat(12)0.1%
Revenue beat(16)9
Avg Revenue beat(16)0.49%
PT rev (1m)1.96%
PT rev (3m)-2.24%
EPS NQ rev (1m)0.6%
EPS NQ rev (3m)-2.79%
EPS NY rev (1m)0%
EPS NY rev (3m)0.19%
Revenue NQ rev (1m)-0.01%
Revenue NQ rev (3m)-0.37%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-0.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 57.92 | ||
| Fwd PE | 43.82 | ||
| P/S | 8.15 | ||
| P/FCF | N/A | ||
| P/OCF | 36.11 | ||
| P/B | 27.93 | ||
| P/tB | N/A | ||
| EV/EBITDA | 63.29 |
EPS(TTM)0.61
EY1.73%
EPS(NY)0.81
Fwd EY2.28%
FCF(TTM)-0.07
FCFYN/A
OCF(TTM)0.98
OCFY2.77%
SpS4.34
BVpS1.27
TBVpS-1.33
PEG (NY)9.86
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -3.84% | ||
| ROE | -22.09% | ||
| ROCE | 0.67% | ||
| ROIC | 0.53% | ||
| ROICexc | 0.91% | ||
| ROICexgc | N/A | ||
| OM | 0.62% | ||
| PM (TTM) | N/A | ||
| GM | 64.53% | ||
| FCFM | N/A |
ROA(3y)-2.65%
ROA(5y)-4.32%
ROE(3y)-13.31%
ROE(5y)-14.67%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.03%
GM growth 5Y-0.54%
F-Score4
Asset Turnover0.6
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.67 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 3.8 | ||
| Cap/Depr | 197.33% | ||
| Cap/Sales | 24.14% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 175.54% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.98 | ||
| Altman-Z | 4.02 |
F-Score4
WACC10.99%
ROIC/WACC0.05
Cap/Depr(3y)135.67%
Cap/Depr(5y)121.89%
Cap/Sales(3y)16.89%
Cap/Sales(5y)14.01%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)32.61%
EPS 3Y25.31%
EPS 5YN/A
EPS Q2Q%0%
EPS Next Y5.87%
EPS Next 2Y14.97%
EPS Next 3Y24.47%
EPS Next 5Y23.03%
Revenue 1Y (TTM)15.2%
Revenue growth 3Y16.15%
Revenue growth 5Y15.71%
Sales Q2Q%12.94%
Revenue Next Year14.76%
Revenue Next 2Y14.66%
Revenue Next 3Y15.59%
Revenue Next 5Y15.87%
EBIT growth 1Y142.14%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year27.81%
EBIT Next 3Y28.57%
EBIT Next 5Y28.3%
FCF growth 1Y-252.96%
FCF growth 3Y-49.75%
FCF growth 5Y-35.88%
OCF growth 1Y91.41%
OCF growth 3Y21.47%
OCF growth 5Y12.25%