Recent News
On August 6, 2025 Vertex announced second-quarter 2025 results and reduced full-year 2025 revenue guidance to $750.0M–$754.0M, citing extended sales cycles and delayed customer decisions. In the days following the release analysts trimmed price targets and forecasts, with several firms lowering their models and target prices.
Technical Analysis
Directional indicators show an emerging trend: ADX at 23.68 signals an emerging trend strength that supports near-term directional conviction tied to the company’s valuation and outlook.
DI+ registered a dip-and-reversal and currently sits at 20.78 while DI- decreased to 26.11; the combination favors a bullish directional shift given DI+ increasing and DI- decreasing, which supports upside attempts against the stock’s current valuation.
MACD stands negative at -0.98 but the MACD line rose above its signal (-1.35), a bullish momentum cross that aligns with the valuation narrative and signals improving momentum from recent lows.
MRO at -28.76 indicates the price sits below the regression target and implies potential upward pressure as the gap narrows; the magnitude suggests a material mean-reversion component to the near-term move.
RSI at 37.64 and rising signals improving buying momentum from lower levels rather than extended overbought conditions, reinforcing the MACD cross as a momentum recovery.
Price relationships show mixed timeframes: the close at $25.15 sits above the 20-day average ($24.69) and near the 12-day EMA reversal, but below the 50-day ($28.57) and far below the 200-day ($39.58), so short-term bias tilts higher while longer-term trend remains unbroken to the downside.
Ichimoku components (Tenkan $24.82; Kijun $24.88; Senkou A $30.84; Senkou B $33.69) place price below the cloud, indicating longer-term resistance in the $31–34 band that ties directly to valuation multiples and the company’s revenue execution risk.
Bollinger band width shows the trading range between roughly $23.13 and $26.26 for two standard deviations; the supertrend upper at $26.28 currently sits just above the close and functions as immediate resistance. Volume at ~2.99M exceeds short- and medium-term averages, confirming conviction behind recent directional moves.
Fundamental Analysis
Revenue performance and growth: total revenue $184,559,000 with year-over-year revenue growth of 53.57% and sequential revenue growth showing a pronounced negative QoQ swing of -642.13% (as reported). ARR and cloud trend commentary in public disclosures show recurring revenue expansion, but the trimmed full-year guidance highlights timing risk in new contracts.
Profitability metrics show narrow operating performance: EBIT (operating income) -$1,564,000, operating margin -0.85%, and gross margin 65.67%. Operating margin declined QoQ by -85.32% and YoY by -118.09%, which compresses free cash conversion despite positive operating cash flow of $46,003,000 and free cash flow $19,587,000.
Earnings: EPS actual -$0.01 versus estimate -$0.03, a $0.02 beat and an EPS surprise ratio of 66.67%; the beat reflects modestly better-than-forecast per-share performance despite a small GAAP loss. Forward EPS sits at $0.17, implying a forward PE of 225.91x.
Balance sheet and leverage: total debt $351,891,000, debt-to-assets 29.37%, debt-to-equity 141.87%, and net debt $51,963,000. Interest coverage remains negative. The capital structure shows meaningful leverage relative to equity that amplifies margin and revenue timing sensitivity.
Valuation multiples and comparatives: P/B at 20.20x sits above the industry peer mean of 12.06x; PEG at 31.74x exceeds the industry peer mean of 17.82x; EV/Revenue (enterprise value $5,078,361,250) and enterprise multiple 221.94 reflect elevated premium pricing tied to expected recurring revenue expansion. WMDST values the stock as under-valued based on the firm’s valuation model, but the market premium contains execution and timing risk captured in current multiples.
Liquidity and efficiency: current ratio 0.99 with cash and short-term investments $284,386,000 supports operating needs; receivables turnover 1.25 and days sales outstanding ~73 days indicate working capital tied to revenue realization. Asset turnover at 0.1569 remains modest compared with the industry peer mean of 0.1297, while asset growth shows 3.82% year-over-year expansion.
MOST-RECENT QUARTERLY REPORT
| REPORT PERIOD ENDING: | 2025-06-30 |
| REPORT DATE: | 2025-08-06 |
| NEXT REPORT DATE: | 2025-11-05 |
| CASH FLOW | Begin Period Cash Flow | $ 303.7 M |
| Operating Cash Flow | $ 46.0 M | |
| Capital Expenditures | $ -26.42 M | |
| Change In Working Capital | $ 7.8 M | |
| Dividends Paid | — | |
| Cash Flow Delta | $ 7.1 M | |
| End Period Cash Flow | $ 310.8 M | |
| INCOME STATEMENT | REVENUE | |
| Total Revenue | $ 184.6 M | |
| Forward Revenue | $ -1.30 B | |
| COSTS | ||
| Cost Of Revenue | $ 63.4 M | |
| Depreciation | $ 23.4 M | |
| Depreciation and Amortization | $ 24.4 M | |
| Research and Development | $ 20.6 M | |
| Total Operating Expenses | $ 186.1 M | |
| PROFITABILITY | ||
| Gross Profit | $ 121.2 M | |
| EBITDA | $ 22.9 M | |
| EBIT | $ -1.56 M | |
| Operating Income | $ -1.56 M | |
| Interest Income | — | |
| Interest Expense | — | |
| Net Interest Income | $ 1.2 M | |
| Income Before Tax | $ -2.64 M | |
| Tax Provision | $ -1.68 M | |
| Tax Rate | 21.0 % | |
| Net Income | $ -961.00 K | |
| Net Income From Continuing Operations | $ -961.00 K | |
| EARNINGS | ||
| EPS Estimate | $ -0.03 | |
| EPS Actual | $ -0.01 | |
| EPS Difference | $ 0.02 | |
| EPS Surprise | 66.667 % | |
| Forward EPS | $ 0.17 | |
| BALANCE SHEET | ASSETS | |
| Total Assets | $ 1.2 B | |
| Intangible Assets | $ 433.0 M | |
| Net Tangible Assets | $ -184.93 M | |
| Total Current Assets | $ 502.7 M | |
| Cash and Short-Term Investments | $ 284.4 M | |
| Cash | $ 284.4 M | |
| Net Receivables | $ 143.7 M | |
| Inventory | — | |
| Long-Term Investments | $ 13.4 M | |
| LIABILITIES | ||
| Accounts Payable | $ 30.4 M | |
| Short-Term Debt | — | |
| Total Current Liabilities | $ 506.3 M | |
| Net Debt | $ 52.0 M | |
| Total Debt | $ 351.9 M | |
| Total Liabilities | $ 950.1 M | |
| EQUITY | ||
| Total Equity | $ 248.0 M | |
| Retained Earnings | $ -43.15 M | |
| VALUATION & PER-SHARE METRICS | EQUITY & PER-SHARE METRICS | |
| Book Value Per-Share | $ 1.56 | |
| Shares Outstanding | 159.398 M | |
| Revenue Per-Share | $ 1.16 | |
| VALUATION | Market Capitalization | $ 5.0 B |
| Enterprise Value | $ 5.1 B | |
| Enterprise Multiple | 221.937 | |
| Enterprise Multiple QoQ | -55.181 % | |
| Enterprise Multiple YoY | 24.539 % | |
| Enterprise Multiple IPRWA | high: 634.148 VERX: 221.937 mean: 91.114 median: 82.154 low: -577.222 |
|
| EV/R | 27.516 | |
| CAPITAL STRUCTURE | ||
| Asset To Equity | 4.831 | |
| Asset To Liability | 1.261 | |
| Debt To Capital | 0.587 | |
| Debt To Assets | 0.294 | |
| Debt To Assets QoQ | -3.531 % | |
| Debt To Assets YoY | 3764.342 % | |
| Debt To Assets IPRWA | high: 1.095 VERX: 0.294 mean: 0.161 median: 0.094 low: 0.002 |
|
| Debt To Equity | 1.419 | |
| Debt To Equity QoQ | -19.05 % | |
| Debt To Equity YoY | 4152.638 % | |
| Debt To Equity IPRWA | high: 3.008 VERX: 1.419 mean: 0.298 median: 0.176 low: -0.874 |
|
| PRICE-BASED VALUATION | ||
| Price To Book (P/B) | 20.202 | |
| Price To Book QoQ | -36.568 % | |
| Price To Book YoY | -14.066 % | |
| Price To Book IPRWA | high: 34.07 VERX: 20.202 mean: 12.061 median: 10.727 low: -16.218 |
|
| Price To Earnings (P/E) | -3626.879 | |
| Price To Earnings QoQ | -1449.507 % | |
| Price To Earnings YoY | -1641.875 % | |
| Price To Earnings IPRWA | high: 564.562 mean: 139.068 median: 130.187 low: -357.639 VERX: -3626.879 |
|
| PE/G Ratio | 31.735 | |
| Price To Sales (P/S) | 27.15 | |
| Price To Sales QoQ | -24.711 % | |
| Price To Sales YoY | -20.189 % | |
| Price To Sales IPRWA | high: 113.355 median: 48.199 mean: 45.699 VERX: 27.15 low: 1.219 |
|
| FORWARD MULTIPLES | ||
| Forward P/E | 225.908 | |
| Forward PE/G | -1.977 | |
| Forward P/S | -3.851 | |
| EFFICIENCY | OPERATIONAL | |
| Operating Leverage | -20.001 | |
| ASSET & SALES | ||
| Asset Turnover Ratio | 0.157 | |
| Asset Turnover Ratio QoQ | 2.844 % | |
| Asset Turnover Ratio YoY | -13.328 % | |
| Asset Turnover Ratio IPRWA | high: 0.416 VERX: 0.157 mean: 0.13 median: 0.129 low: 0.0 |
|
| Receivables Turnover | 1.247 | |
| Receivables Turnover Ratio QoQ | 11.549 % | |
| Receivables Turnover Ratio YoY | -1.993 % | |
| Receivables Turnover Ratio IPRWA | high: 4.366 mean: 1.421 median: 1.257 VERX: 1.247 low: 0.131 |
|
| Inventory Turnover | — | |
| Inventory Turnover Ratio QoQ | — | |
| Inventory Turnover Ratio YoY | — | |
| Inventory Turnover Ratio IPRWA | — | |
| Days Sales Outstanding (DSO) | 73.174 | |
| CASH CYCLE | ||
| Cash Conversion Cycle Days (CCC) | — | |
| Cash Conversion Cycle Days QoQ | — | |
| Cash Conversion Cycle Days YoY | — | |
| Cash Conversion Cycle Days IPRWA | — | |
| CAPITAL DEPLOYMENT | ||
| Cash Conversion Ratio | -51.366 | |
| CapEx To Revenue | -0.143 | |
| CapEx To Depreciation | -1.128 | |
| CAPITAL, LIQUIDITY & COVERAGE | CAPITAL STRUCTURE | |
| Total Capital | $ 584.4 M | |
| Net Invested Capital | $ 584.4 M | |
| Invested Capital | $ 584.4 M | |
| Net Tangible Assets | $ -184.93 M | |
| Net Working Capital | $ -3.59 M | |
| LIQUIDITY | ||
| Cash Ratio | 0.562 | |
| Current Ratio | 0.993 | |
| Current Ratio QoQ | 0.893 % | |
| Current Ratio YoY | -15.318 % | |
| Current Ratio IPRWA | high: 9.787 mean: 1.695 median: 1.335 VERX: 0.993 low: 0.079 |
|
| Quick Ratio | — | |
| Quick Ratio QoQ | — | |
| Quick Ratio YoY | — | |
| Quick Ratio IPRWA | — | |
| COVERAGE & LEVERAGE | ||
| Debt To EBITDA | 15.379 | |
| Cost Of Debt | 0.66 % | |
| Interest Coverage Ratio | -0.532 | |
| Interest Coverage Ratio QoQ | -84.688 % | |
| Interest Coverage Ratio YoY | -101.277 % | |
| Interest Coverage Ratio IPRWA | high: 181.115 median: 41.426 mean: 37.827 VERX: -0.532 low: -372.737 |
|
| Operating Cash Flow Ratio | 0.074 | |
| TIMING / LIQUIDITY | ||
| Days Payables Outstanding (DPO) | 39.466 | |
| DIVIDENDS | ||
| Dividend Coverage Ratio | — | |
| Dividend Payout Ratio | — | |
| Dividend Rate | — | |
| Dividend Yield | — | |
| PERFORMANCE | GROWTH | |
| Asset Growth Rate | 3.816 % | |
| Revenue Growth | 4.234 % | |
| Revenue Growth QoQ | -642.125 % | |
| Revenue Growth YoY | 53.573 % | |
| Revenue Growth IPRWA | high: 32.808 % median: 8.562 % mean: 6.948 % VERX: 4.234 % low: -21.897 % |
|
| Earnings Growth | -114.286 % | |
| Earnings Growth QoQ | -1.714 % | |
| Earnings Growth YoY | — | |
| Earnings Growth IPRWA | high: 157.143 % median: 5.491 % mean: 4.868 % VERX: -114.286 % low: -200.0 % |
|
| MARGINS | ||
| Gross Margin | 65.67 % | |
| Gross Margin QoQ | 2.905 % | |
| Gross Margin YoY | 3.028 % | |
| Gross Margin IPRWA | high: 91.297 % mean: 72.328 % median: 67.98 % VERX: 65.67 % low: 33.069 % |
|
| EBIT Margin | -0.847 % | |
| EBIT Margin QoQ | -85.318 % | |
| EBIT Margin YoY | -118.087 % | |
| EBIT Margin IPRWA | high: 74.313 % median: 42.991 % mean: 34.284 % VERX: -0.847 % low: -124.558 % |
|
| Return On Sales (ROS) | -0.847 % | |
| Return On Sales QoQ | -85.318 % | |
| Return On Sales YoY | -118.087 % | |
| Return On Sales IPRWA | high: 76.082 % median: 36.932 % mean: 34.043 % VERX: -0.847 % low: -117.376 % |
|
| CASH FLOW | ||
| Free Cash Flow (FCF) | $ 19.6 M | |
| Free Cash Flow Yield | 0.391 % | |
| Free Cash Flow Yield QoQ | -303.646 % | |
| Free Cash Flow Yield YoY | -41.988 % | |
| Free Cash Flow Yield IPRWA | high: 6.936 % median: 0.694 % mean: 0.529 % VERX: 0.391 % low: -13.154 % |
|
| Free Cash Growth | -259.894 % | |
| Free Cash Growth QoQ | 54.288 % | |
| Free Cash Growth YoY | -136.066 % | |
| Free Cash Growth IPRWA | high: 278.713 % median: 25.957 % mean: 12.393 % VERX: -259.894 % low: -316.997 % |
|
| Free Cash To Net Income | -20.382 | |
| Cash Flow Margin | 20.386 % | |
| Cash Flow To Earnings | -39.151 | |
| VALUE & RETURNS | ||
| Economic Value Added | $ 0.04 | |
| Return On Assets (ROA) | -0.082 % | |
| Return On Assets QoQ | -108.551 % | |
| Return On Assets YoY | -114.138 % | |
| Return On Assets IPRWA | high: 14.05 % median: 4.609 % mean: 3.677 % VERX: -0.082 % low: -24.058 % |
|
| Return On Capital Employed (ROCE) | -0.226 % | |
| Return On Equity (ROE) | -0.004 | |
| Return On Equity QoQ | -106.972 % | |
| Return On Equity YoY | -117.472 % | |
| Return On Equity IPRWA | high: 0.214 median: 0.079 mean: 0.07 VERX: -0.004 low: -0.337 |
|
| DuPont ROE | -0.429 % | |
| Return On Invested Capital (ROIC) | -0.211 % | |
| Return On Invested Capital QoQ | -81.54 % | |
| Return On Invested Capital YoY | -86.975 % | |
| Return On Invested Capital IPRWA | high: 14.534 % median: 6.508 % mean: 5.545 % VERX: -0.211 % low: -13.655 % |
|