Vertex Stock: Reasons Behind One Fund Increasing Its $94.3 Million Stake Despite Declining Shares
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 07 2025
0mins
Should l Buy VERX?
Source: NASDAQ.COM
Tensile Capital Management's Stake in Vertex: Tensile Capital Management increased its position in Vertex by 160,559 shares in Q3, bringing its total to 3.8 million shares valued at $94.3 million, making it the fund's largest holding.
Market Value Decline: Despite the increase in shares, the market value of Tensile's position fell by approximately $34.4 million, with Vertex shares trading 65% lower than in January.
Vertex's Financial Performance: Vertex reported double-digit revenue growth, including a 12.7% increase in overall revenue and a 29.6% rise in cloud revenue, alongside a new $150 million share-repurchase program.
Investment Outlook: The significant drop in Vertex's stock price presents a contrarian investment opportunity, as the company maintains strong fundamentals, including $648 million in annual recurring revenue and a 107% net revenue retention rate.
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Analyst Views on VERX
Wall Street analysts forecast VERX stock price to rise
13 Analyst Rating
7 Buy
6 Hold
0 Sell
Moderate Buy
Current: 12.370
Low
22.00
Averages
27.42
High
37.00
Current: 12.370
Low
22.00
Averages
27.42
High
37.00
About VERX
Vertex, Inc. is a global provider of indirect tax solutions. The Company and its subsidiaries operate as solutions providers of state, local and value-added tax calculation, compliance, and analytics, offering software products that are sold through software licenses and software-as-a-service (cloud) subscriptions. It also provides implementation and training services in connection with its software license and cloud subscriptions, transaction tax returns outsourcing, and other tax-related services. Its software includes tax determination, compliance and reporting, tax data management and document management tools, analytics and insights, as well as pre-built integrations with business applications. Its tax-determination solutions enable real-time calculation of indirect taxes and applicable fees for sale and purchase transactions. Its compliance and reporting solutions enable the automation of signature-ready returns and remittance of indirect tax to appropriate jurisdictions.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Investor Considerations: Investors considering purchasing VERX stock should pay attention to the latest insights from analysts to make more informed investment decisions, especially amid increasing market uncertainties.
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- Customer Attrition Challenges: Despite a 9.1% revenue increase, 2025 faced heightened customer attrition, particularly among smaller clients, driven by uncontrollable factors like M&A and bankruptcies, impacting retention metrics, which management is addressing with strategic initiatives.
- AI Strategic Transformation: CEO Chris Young emphasized the goal of transforming Vertex into an AI-first company, anticipating that new offerings like smart categorization will enhance internal efficiency and customer service capabilities, thereby driving future revenue growth.
- Optimistic 2026 Outlook: CFO John Schwab provided guidance for 2026 revenues of $823.5 million to $831.5 million, with cloud revenue expected to grow by 25%, and adjusted EBITDA targets of $188 million to $192 million, indicating strong confidence in future growth prospects.
See More
Vertex (VERX) Q4 2025 Earnings Call Transcript
See More
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- Earnings Highlights: Vertex reported a non-GAAP EPS of $0.17 for Q4 2025, with revenue reaching $194.7 million, reflecting a 9.1% year-over-year growth, indicating the company's stable growth potential in the market.
- Software Subscription Revenue Growth: Software subscription revenues totaled $166.2 million, up 8.9% year-over-year, demonstrating the company's ongoing appeal and expansion of its customer base in the software services sector.
- Significant Cloud Revenue Increase: Cloud revenues reached $94.6 million, a 23.0% increase year-over-year, highlighting the company's strong performance and rising demand in the cloud computing space, further solidifying its market position.
- Annual Recurring Revenue: The Annual Recurring Revenue (ARR) stood at $671.0 million, up 11.3%, showcasing the company's solid performance in customer retention and revenue stability, despite a slight decline in Net Revenue Retention to 105%.
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- Revenue Expectations: The anticipated revenue for Q4 is $194.33 million, representing an 8.9% year-over-year increase, suggesting ongoing improvements in market demand and sales, which could further bolster investor confidence.
- Performance Record: Over the past two years, Vertex has beaten EPS and revenue estimates 100% of the time, showcasing exceptional financial management and market adaptability, thereby enhancing its reputation among investors.
- Analyst Rating Changes: Piper Sandler has downgraded Vertex, yet the company's consistent performance record may attract long-term investors, particularly in the current market environment.
See More
Wall Street Analysts Adjust Ratings
- Analyst Rating Changes: Top Wall Street analysts have adjusted their ratings on several companies, reflecting varying market perspectives that could influence investor decisions and market trends.
- Overview of Updates: The rating changes include upgrades, downgrades, and new initiations, showcasing analysts' keen responses to market dynamics, which may lead to short-term volatility in the affected stocks.
- Investor Considerations: Investors considering purchasing VERX stock should pay attention to the latest insights from analysts to make more informed investment decisions, especially amid increasing market uncertainties.
- Market Impact Analysis: The adjustments in analysts' ratings not only affect the performance of individual stocks but may also influence overall market sentiment, prompting investors to closely monitor these changes to seize investment opportunities.
See More
