Vertex (VERX, Financial) has unveiled a suite of new integrations and solution upgrades aimed at enhancing connectivity across various systems, including ERP, e-commerce, procurement, and financial platforms. These advancements underscore Vertex’s dedication to simplifying and automating global indirect tax processes. By offering scalable, pre-configured solutions, Vertex aims to minimize implementation durations and bolster real-time accuracy while maintaining clean-core ERP strategies, ensuring that businesses can modernize their tax operations without interrupting daily functions.
As the complexity of procurement and commerce systems increases, Vertex is refining its integrations with major platforms like SAP, Oracle, Coupa, and Shopify. These efforts are expected to improve tax determination efficiency and accuracy across worldwide transactions. Among the new offerings is Vertex Copilot, an AI-driven assistant embedded within their comprehensive ecosystem, and Vertex Express Returns, which streamlines U.S. and Canadian indirect tax compliance.
With significant tax reforms anticipated in Brazil and a surge in cross-border commerce, Vertex is equipping organizations to remain agile and prepared for future changes. The company is committed to supporting evolving tax models with practical, innovative solutions that meet the demands of modern global commerce.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 14 analysts, the average target price for Vertex Inc (VERX, Financial) is $47.03 with a high estimate of $61.00 and a low estimate of $31.00. The average target implies an upside of 40.61% from the current price of $33.45. More detailed estimate data can be found on the Vertex Inc (VERX) Forecast page.
Based on the consensus recommendation from 16 brokerage firms, Vertex Inc's (VERX, Financial) average brokerage recommendation is currently 2.1, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Vertex Inc (VERX, Financial) in one year is $32.08, suggesting a downside of 4.1% from the current price of $33.45. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Vertex Inc (VERX) Summary page.
VERX Key Business Developments
Release Date: May 07, 2025
- Revenue: $177.1 million, up 12.9% year over year.
- Subscription Revenue: Increased 14.4% to $150.8 million.
- Cloud Revenue: $80.2 million, up 29.6% from last year's first quarter.
- Adjusted EBITDA: $37.8 million, representing an EBITDA margin of 21.3%.
- Annual Recurring Revenue (ARR): Grew 17.9% to $618.5 million.
- Net Revenue Retention (NRR): 109%.
- Gross Revenue Retention (GRR): 95%.
- Average Annual Revenue Per Customer (AARPC): $140,943, up 14.1% year over year.
- Gross Margin: 75%.
- Operating Cash Flow: $14.8 million.
- Free Cash Flow: Negative $12.3 million.
- Unrestricted Cash and Cash Equivalents: Over $270.4 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Vertex Inc (VERX, Financial) reported a strong start to 2025 with a 12.9% year-over-year increase in revenue, reaching $177.1 million.
- Subscription revenue grew by 14.4%, and cloud revenue saw a significant increase of 29.6% in the first quarter.
- Annual recurring revenue (ARR) increased by 17.9% to $618.5 million, indicating strong customer retention and growth.
- Vertex Inc (VERX) announced an equity investment in Kintsugi, a startup focused on AI technology for indirect tax, which could enhance their offerings in the SMB market.
- The company achieved a gross recurring revenue (GRR) of 95%, within their targeted best-in-class range of 94% to 96%.
Negative Points
- Net revenue retention (NRR) decreased to 109% from 112% in the previous year's first quarter.
- Free cash flow was negative at $12.3 million, impacted by seasonal cash flow patterns and accelerated investments.
- The company experienced a decline in direct customers, attributed to lower-end customers migrating away.
- Gross margin on services decreased to 31.1% from 40.5% in the previous year's first quarter, driven by higher compensation expenses and lower-margin services.
- Adjusted EBITDA showed only a modest increase of 1.3% year over year, with expectations of a slight decrease in the second quarter.
