Verra Mobility Cuts Full-Year Guidance After Major Contract Loss
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 53 minutes ago
0mins
Source: PRnewswire
- Contract Termination Impact: Verra Mobility disclosed that Avis Budget Group terminated a contract, resulting in a loss of over 10% of annual revenue, with an estimated annualized impact of $135 million to $145 million on its Commercial Services segment, severely undermining the company's financial stability.
- Stock Price Plunge: Following the contract termination announcement, Verra Mobility's stock plummeted approximately 45%, significantly eroding shareholder investment value and reflecting serious market concerns about the company's future profitability.
- Guidance Withdrawal: Just 20 days after reaffirming its full-year guidance, the company was forced to retract its previous revenue forecast of $1.02 billion to $1.03 billion, indicating a misjudgment by management regarding market conditions that could affect investor confidence.
- Legal Investigation Initiated: Due to the company's failure to timely disclose the contract termination, investors are launching an investigation into potentially misleading statements, which could lead to further legal liabilities and financial losses.
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Analyst Views on VRRM
Wall Street analysts forecast VRRM stock price to rise
4 Analyst Rating
3 Buy
1 Hold
0 Sell
Strong Buy
Current: 13.080
Low
24.00
Averages
29.33
High
33.00
Current: 13.080
Low
24.00
Averages
29.33
High
33.00
About VRRM
Verra Mobility Corporation is a provider of smart mobility technology solutions across United States, Australia, Europe, and Canada. The Company operates through three segments, which include Commercial Services, Government Solutions, and Parking Solutions. The Commercial Services segment offers toll and violation management solutions and title and registration services for commercial fleet customers, including Rental Car Companies (RACs) and Fleet Management Companies (FMCs) in North America. It also provides tolling and violations processing services. The Government Solutions segment offers photo enforcement automated safety solutions and services to states, municipalities, counties, school districts, and law enforcement agencies of all sizes. The Parking Solutions segment provides parking software, transaction processing, and hardware solutions to universities, municipalities, commercial parking operators, and health care facilities.
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.
Verra Mobility Cuts Full-Year Guidance After Major Contract Loss
- Contract Termination Impact: Verra Mobility disclosed that Avis Budget Group terminated a contract, resulting in a loss of over 10% of annual revenue, with an estimated annualized impact of $135 million to $145 million on its Commercial Services segment, severely undermining the company's financial stability.
- Stock Price Plunge: Following the contract termination announcement, Verra Mobility's stock plummeted approximately 45%, significantly eroding shareholder investment value and reflecting serious market concerns about the company's future profitability.
- Guidance Withdrawal: Just 20 days after reaffirming its full-year guidance, the company was forced to retract its previous revenue forecast of $1.02 billion to $1.03 billion, indicating a misjudgment by management regarding market conditions that could affect investor confidence.
- Legal Investigation Initiated: Due to the company's failure to timely disclose the contract termination, investors are launching an investigation into potentially misleading statements, which could lead to further legal liabilities and financial losses.
See More
Verra Mobility Cuts Guidance by Up to $145 Million After Major Contract Loss
- Contract Termination Impact: Verra Mobility disclosed that Avis Budget Group terminated a contract, resulting in a revenue loss exceeding 10%, with an estimated annualized impact of $135 million to $145 million on its Commercial Services segment, directly affecting the company's financial stability.
- Stock Price Plunge: Following the announcement of the contract termination, Verra Mobility's stock price plummeted by approximately 45%, significantly eroding shareholder investment value and reflecting severe market concerns regarding the company's future profitability.
- Guidance Withdrawal: Just 20 days after reaffirming full-year revenue guidance of $1.02 billion to $1.03 billion, the company was forced to retract this guidance, indicating a lack of confidence from management in future performance, which may impact investor sentiment.
- Legal Investigation Initiated: Due to the company's failure to disclose relevant information prior to the contract termination, investors are launching an investigation into potential misleading statements, which could lead to further legal liabilities and financial losses.
See More
Verra Mobility Shares Plunge 74% Following Avis Termination Notice
- Stock Price Crash: On May 27, 2026, Verra Mobility's shares plummeted by 74% after the company disclosed receiving a termination notice from Avis Budget Group, resulting in a loss of approximately $1.47 billion in market capitalization in a single day, indicating extreme market pessimism regarding the company's future prospects.
- Contractual Relationship Crisis: Despite management's assurances during the May 6, 2026 earnings call that negotiations with Avis were “constructive,” the abrupt termination notice just 20 days later revealed significant mismanagement in maintaining relationships with key clients, raising concerns about the company's operational stability.
- Cost-Cutting Measures: In response to the unexpected contract termination, Verra announced immediate actions to cut costs and adapt operations, which not only impacts the company's short-term financial performance but may also have long-term strategic implications for its business direction.
- Legal Investigation Initiated: The severe market reaction has prompted Hagens Berman to launch an investigation into Verra's transparency, focusing on whether the company violated federal securities laws by failing to disclose critical information in a timely manner, potentially exposing it to legal liabilities.
See More
Mixed Close for US Stocks as Oil Prices Plunge
- Market Performance: On Wednesday, the S&P 500 Index rose by 0.02%, the Dow Jones Industrial Average increased by 0.36% to a new record high, while the Nasdaq 100 fell by 0.09%, indicating a divergence in market sentiment amid enthusiasm for artificial intelligence and declining oil prices.
- Oil Price Fluctuations: Crude oil prices plummeted over 5% to a five-week low due to optimism surrounding a US-Iran peace deal, which eased inflation expectations and pushed the 10-year Treasury yield down to a 1.5-week low of 4.45%, providing support for the bond market.
- Mortgage Application Decline: US MBA mortgage applications fell by 8.5% for the week ending May 22, with the purchase mortgage sub-index down 0.4% and the refinancing sub-index down 18.1%, reflecting the dampening effect of high interest rates on housing demand, as the average 30-year fixed mortgage rate rose to 6.65%.
- Corporate Earnings Outlook: As of Wednesday, 83% of the 475 S&P 500 companies that reported Q1 earnings exceeded expectations, with projected earnings growth of 12% year-over-year, but excluding the technology sector, the growth is only 3%, indicating signs of overall earnings weakness.
See More
Mixed Close for US Indices as Oil Prices Ease
- Mixed Market Performance: On Wednesday, US stock indices closed mixed, with the S&P 500 ending flat, the Nasdaq 100 down 0.1%, and the Dow Jones Industrial Average rising 0.4% to 50,644.28 points, reflecting investor caution amid mixed signals.
- Oil Price Decline: US crude oil prices fell 5.55% to settle at $88.68 per barrel after Iranian media claimed a commitment to restore commercial traffic through the Strait of Hormuz, although the White House denied this report, indicating ongoing uncertainty in oil price trends.
- Tech Stock Pullback: Chipmakers like Qualcomm (QCOM) and Intel (INTC) experienced pullbacks on Wednesday as investors grew wary of persistent inflation and imminent rate hikes, leading to the Nasdaq snapping a four-day winning streak.
- Meta's Subscription Plans: Shares of Meta Platforms (META) rose following reports that the company plans to launch paid consumer subscriptions for its Meta AI chatbot, highlighting its strategic expansion in the artificial intelligence sector.
See More
Verra Mobility Faces Major Client Loss Impacting Growth Outlook
- Client Loss Impact: The termination of the contract with Avis is expected to reduce Verra Mobility's Commercial Services annualized revenue by approximately $135 million to $145 million and segment profit by $120 million to $125 million in 2026, significantly undermining the company's revenue outlook and market confidence.
- Stock Price Plunge: Shares of Verra Mobility nosedived over 71% on Wednesday, hitting a record low, as multiple analysts cut price targets, with Morgan Stanley lowering its target from $15 to $4, reflecting a pessimistic outlook on the company's future.
- Rating Downgrade: William Blair downgraded Verra's rating from 'Outperform' to 'Market Perform,' noting that the loss of Avis is a major blow to Verra's rental car tolling business, which carries a 65% EBITDA margin, suggesting the stock may remain range-bound over the next 12 months.
- Revised Outlook: Verra Mobility revised its full-year 2026 revenue outlook down from $1.02 billion to $1.03 billion to a range of $985 million to $995 million, with adjusted earnings per share expectations also lowered from $1.32 to $1.38 to $1.19 to $1.25, indicating increased financial pressure on the company.
See More
Verra Mobility Cuts Full-Year Guidance After Major Contract Loss
- Contract Termination Impact: Verra Mobility disclosed that Avis Budget Group terminated a contract, resulting in a loss of over 10% of annual revenue, with an estimated annualized impact of $135 million to $145 million on its Commercial Services segment, severely undermining the company's financial stability.
- Stock Price Plunge: Following the contract termination announcement, Verra Mobility's stock plummeted approximately 45%, significantly eroding shareholder investment value and reflecting serious market concerns about the company's future profitability.
- Guidance Withdrawal: Just 20 days after reaffirming its full-year guidance, the company was forced to retract its previous revenue forecast of $1.02 billion to $1.03 billion, indicating a misjudgment by management regarding market conditions that could affect investor confidence.
- Legal Investigation Initiated: Due to the company's failure to timely disclose the contract termination, investors are launching an investigation into potentially misleading statements, which could lead to further legal liabilities and financial losses.
See More
Verra Mobility Cuts Guidance by Up to $145 Million After Major Contract Loss
- Contract Termination Impact: Verra Mobility disclosed that Avis Budget Group terminated a contract, resulting in a revenue loss exceeding 10%, with an estimated annualized impact of $135 million to $145 million on its Commercial Services segment, directly affecting the company's financial stability.
- Stock Price Plunge: Following the announcement of the contract termination, Verra Mobility's stock price plummeted by approximately 45%, significantly eroding shareholder investment value and reflecting severe market concerns regarding the company's future profitability.
- Guidance Withdrawal: Just 20 days after reaffirming full-year revenue guidance of $1.02 billion to $1.03 billion, the company was forced to retract this guidance, indicating a lack of confidence from management in future performance, which may impact investor sentiment.
- Legal Investigation Initiated: Due to the company's failure to disclose relevant information prior to the contract termination, investors are launching an investigation into potential misleading statements, which could lead to further legal liabilities and financial losses.
See More
Verra Mobility Shares Plunge 74% Following Avis Termination Notice
- Stock Price Crash: On May 27, 2026, Verra Mobility's shares plummeted by 74% after the company disclosed receiving a termination notice from Avis Budget Group, resulting in a loss of approximately $1.47 billion in market capitalization in a single day, indicating extreme market pessimism regarding the company's future prospects.
- Contractual Relationship Crisis: Despite management's assurances during the May 6, 2026 earnings call that negotiations with Avis were “constructive,” the abrupt termination notice just 20 days later revealed significant mismanagement in maintaining relationships with key clients, raising concerns about the company's operational stability.
- Cost-Cutting Measures: In response to the unexpected contract termination, Verra announced immediate actions to cut costs and adapt operations, which not only impacts the company's short-term financial performance but may also have long-term strategic implications for its business direction.
- Legal Investigation Initiated: The severe market reaction has prompted Hagens Berman to launch an investigation into Verra's transparency, focusing on whether the company violated federal securities laws by failing to disclose critical information in a timely manner, potentially exposing it to legal liabilities.
See More
Mixed Close for US Stocks as Oil Prices Plunge
- Market Performance: On Wednesday, the S&P 500 Index rose by 0.02%, the Dow Jones Industrial Average increased by 0.36% to a new record high, while the Nasdaq 100 fell by 0.09%, indicating a divergence in market sentiment amid enthusiasm for artificial intelligence and declining oil prices.
- Oil Price Fluctuations: Crude oil prices plummeted over 5% to a five-week low due to optimism surrounding a US-Iran peace deal, which eased inflation expectations and pushed the 10-year Treasury yield down to a 1.5-week low of 4.45%, providing support for the bond market.
- Mortgage Application Decline: US MBA mortgage applications fell by 8.5% for the week ending May 22, with the purchase mortgage sub-index down 0.4% and the refinancing sub-index down 18.1%, reflecting the dampening effect of high interest rates on housing demand, as the average 30-year fixed mortgage rate rose to 6.65%.
- Corporate Earnings Outlook: As of Wednesday, 83% of the 475 S&P 500 companies that reported Q1 earnings exceeded expectations, with projected earnings growth of 12% year-over-year, but excluding the technology sector, the growth is only 3%, indicating signs of overall earnings weakness.
See More
Mixed Close for US Indices as Oil Prices Ease
- Mixed Market Performance: On Wednesday, US stock indices closed mixed, with the S&P 500 ending flat, the Nasdaq 100 down 0.1%, and the Dow Jones Industrial Average rising 0.4% to 50,644.28 points, reflecting investor caution amid mixed signals.
- Oil Price Decline: US crude oil prices fell 5.55% to settle at $88.68 per barrel after Iranian media claimed a commitment to restore commercial traffic through the Strait of Hormuz, although the White House denied this report, indicating ongoing uncertainty in oil price trends.
- Tech Stock Pullback: Chipmakers like Qualcomm (QCOM) and Intel (INTC) experienced pullbacks on Wednesday as investors grew wary of persistent inflation and imminent rate hikes, leading to the Nasdaq snapping a four-day winning streak.
- Meta's Subscription Plans: Shares of Meta Platforms (META) rose following reports that the company plans to launch paid consumer subscriptions for its Meta AI chatbot, highlighting its strategic expansion in the artificial intelligence sector.
See More
Verra Mobility Faces Major Client Loss Impacting Growth Outlook
- Client Loss Impact: The termination of the contract with Avis is expected to reduce Verra Mobility's Commercial Services annualized revenue by approximately $135 million to $145 million and segment profit by $120 million to $125 million in 2026, significantly undermining the company's revenue outlook and market confidence.
- Stock Price Plunge: Shares of Verra Mobility nosedived over 71% on Wednesday, hitting a record low, as multiple analysts cut price targets, with Morgan Stanley lowering its target from $15 to $4, reflecting a pessimistic outlook on the company's future.
- Rating Downgrade: William Blair downgraded Verra's rating from 'Outperform' to 'Market Perform,' noting that the loss of Avis is a major blow to Verra's rental car tolling business, which carries a 65% EBITDA margin, suggesting the stock may remain range-bound over the next 12 months.
- Revised Outlook: Verra Mobility revised its full-year 2026 revenue outlook down from $1.02 billion to $1.03 billion to a range of $985 million to $995 million, with adjusted earnings per share expectations also lowered from $1.32 to $1.38 to $1.19 to $1.25, indicating increased financial pressure on the company.
See More
