Vertex (VERX) Valuation Discount and Projected 82.67% Earnings Growth Indicate Positive Outlook
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Nov 04 2025
0mins
Should l Buy VERX?
Source: Yahoo Finance
Vertex's Financial Performance: Vertex (VERX) is narrowing its losses at an average rate of 16.4% per year, with projected annual revenue growth of 12.4% and earnings growth of 82.67%, indicating a positive outlook for investors.
Cloud Revenue Impact: Analysts expect Vertex's profit margins to improve significantly due to a shift towards high-margin cloud revenue, which is anticipated to enhance operating efficiency and long-term earnings quality.
Regulatory Catalysts and Risks: Upcoming e-invoicing regulations in Europe are expected to drive demand for Vertex's tax automation solutions, although regulatory complexities and budget pressures may lead to longer sales cycles and unpredictable revenue growth.
Valuation and Market Position: Vertex's current Price-To-Sales Ratio of 5.1x is below industry averages, suggesting a potential upside opportunity, but analysts caution that achieving ambitious revenue and earnings targets will be crucial for justifying the stock's valuation.
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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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- 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.
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Vertex (VERX) Q4 2025 Earnings Call Transcript
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- 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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- 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.
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- 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
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- HUBS Price Potential: HubSpot Inc (HUBS) is currently trading at $228.95, with an analyst target price of $524.88, suggesting a 129.25% upside, showcasing strong confidence from analysts regarding its future growth.
- VERX Growth Expectations: Vertex Inc (VERX) has a current share price of $12.37, while analysts project a target price of $27.57, indicating a potential upside of 122.89%, reflecting a positive outlook on its business prospects.
- NCNO Market Outlook: nCino Inc (NCNO) is trading at $15.85, with an analyst target price of $33.93, which implies a 114.09% upside potential, demonstrating analysts' positive expectations for its future performance.
See More
Vertex, Inc. Q4 2025 Earnings Call Insights
- Stable Financial Performance: Vertex reported Q4 2025 revenue of $194.7 million, meeting expectations, while adjusted EBITDA reached $42.5 million, exceeding the high end of guidance, reflecting strong performance with a blue-chip customer base, including over 60% of Fortune 500 companies.
- 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
Vertex Reports Q4 2025 Earnings with Revenue Growth
- 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%.
See More
Vertex to Announce Q4 Earnings on February 11th
- Earnings Announcement: Vertex (VERX) is set to release its Q4 earnings on February 11th before market open, with a consensus EPS estimate of $0.16, reflecting a 6.7% year-over-year growth, indicating stable profitability.
- 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
