Last Update 02 Mar 26

Fair value Decreased 63%

THRY: AI Native SaaS Shift And Index Removals Will Set Up Rebound

Analysts have reduced their price targets on Thryv Holdings, with our fair value estimate moving from $13.00 to $4.75, as they factor in the shift toward an AI native unified SaaS platform, higher expected churn among smaller clients, updated discount rate assumptions, and a lower future P/E multiple despite slightly higher projected profit margins.

Analyst Commentary

Recent Street research has focused on how Thryv's shift toward an AI native unified SaaS platform and updated guidance are feeding into valuation, growth expectations, and execution risk.

Bullish Takeaways

Some bullish analysts point to the modest Q4 beat as a sign that the current profit profile can support the transition, even with lower price targets. This helps frame the recent reset as more about future positioning than current earnings power.
Management's view that churn will be concentrated in smaller customers, with a focus on higher value clients over time, is seen by bullish analysts as a cleaner path to a more profitable SaaS mix.
Comments around a potential return to durable growth and free cash flow expansion after the initial churn period are being used by bullish analysts to justify keeping ratings positive despite lower targets.
The recalibration of targets to US$5 and US$7, from prior levels of US$15 and US$13, is framed by bullish analysts as aligning expectations with the new SaaS roadmap and updated P/E assumptions rather than a loss of confidence in the business model.

Bearish Takeaways

Bearish analysts are focused on the sharp share reaction following FY26 guidance, including the reported 46% drop, as a sign that the market is highly sensitive to execution risk around the AI native SaaS shift.
Expected churn among smaller clients in 1H26 highlights near term pressure on reported SaaS metrics, which bearish analysts see as a headwind to both growth and valuation until there is clearer evidence of stabilisation.
The lower price targets, from US$15 to US$5 and from US$13 to US$7, underscore that prior expectations embedded a higher future P/E multiple and more supportive outlook than what current guidance implies.
References to broader macro challenges that could affect SMB marketing spend add another layer of uncertainty for revenue visibility, making some bearish analysts more cautious on the timing and strength of any rebound.

What's in the News

Thryv Holdings, Inc. (NasdaqCM: THRY) was removed from the S&P 600 Communication Services sector index, reducing its presence in that small cap sector benchmark (S&P indices).
The company was also dropped from the broader S&P 600 index, which can affect index fund ownership tied to that benchmark (S&P indices).
Thryv was removed from the S&P Composite 1500 index, limiting its inclusion across a wide range of U.S. equity index products (S&P indices).
The stock was taken out of the S&P 1000 index, further reducing its representation in U.S. small and mid cap index baskets (S&P indices).

Valuation Changes

Fair Value: revised from $13.00 to $4.75, a significant reset in the implied equity value per share.
Discount Rate: moved from 9.26% to 10.51%, reflecting a higher required return in the updated model.
Revenue Growth: adjusted from a 12.43% decline to a 15.26% decline, indicating a steeper expected contraction in top line.
Net Profit Margin: updated from 8.44% to 9.55%, pointing to a modestly higher projected level of profitability on revenue.
Future P/E: reduced from 16.48x to 6.33x, indicating a materially lower earnings multiple applied in the revised assumptions.

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Key Takeaways

Expansion into digital SaaS solutions and targeted industry offerings is boosting customer retention, recurring revenue, and profitability through increased multiproduct adoption.
Reduced debt obligations and possible reclassification as a software company position Thryv for higher investment capacity and improved market valuation.
Reliance on upselling amid subscriber losses, managed legacy declines, and integration risks leaves Thryv vulnerable to competition, margin compression, and long-term revenue challenges.

Catalysts

About Thryv Holdings

Provides digital marketing solutions and cloud-based tools to the small-to-medium-sized businesses in the United States.What are the underlying business or industry changes driving this perspective?

The accelerating shift of SMBs to digital and cloud-based platforms continues to expand Thryv's addressable market for its SaaS solutions, as demonstrated by 25% year-over-year SaaS revenue growth and ongoing print-to-SaaS customer migrations; this bodes well for future revenue growth and higher recurring revenue visibility.
Verticalization initiatives (e.g., Thryv for HVAC) and product ecosystem enhancements (like Workforce Center) are increasing ARPU, customer retention, and cross-sell rates, supporting stronger profitability and higher net margins as more value-added services are adopted by the existing base.
Continued integration of data-driven automation and marketing tools is driving multiproduct adoption and net revenue retention (currently at 103%), likely reducing churn and leading to more durable, predictable earnings growth.
Thryv's progress on deleveraging and upcoming lower amortization requirements unlocks free cash flow, enabling greater investment in R&D, sales channels, marketing, or potential share buybacks-each a potential catalyst for higher earnings and share price re-rating.
The anticipated reclassification of Thryv under the software industry GICS code could improve market visibility and investor discovery, potentially narrowing the valuation gap and catalyzing a re-rating as software peer multiples are applied.

Thryv Holdings Earnings and Revenue Growth

Thryv Holdings Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming Thryv Holdings's revenue will decrease by 5.8% annually over the next 3 years.
Analysts assume that profit margins will increase from -11.1% today to 25.6% in 3 years time.
Analysts expect earnings to reach $162.6 million (and earnings per share of $3.45) by about September 2028, up from $-83.9 million today. The analysts are largely in agreement about this estimate.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 8.3x on those 2028 earnings, up from -6.5x today. This future PE is lower than the current PE for the US Media industry at 20.8x.
Analysts expect the number of shares outstanding to grow by 4.5% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 7.57%, as per the Simply Wall St company report.

Thryv Holdings Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

Thryv's continued organic subscriber contraction and flat subscriber growth in 2025 highlight an underlying risk of "churn masking" revenue growth with ARPU gains, which could limit long-term recurring revenue expansion and ultimately pressure future topline growth if new customer acquisition fails to rebound.
The company's legacy Marketing Services (print and traditional directory) revenues are experiencing a managed but persistent multi-year decline, and even with successful SaaS migration, the eventual sunsetting of these pre-existing cash flows by 2028 introduces a potential revenue gap and long-term margin headwind as high-margin legacy profits run off.
Thryv's SaaS growth remains heavily dependent on upselling additional products to existing customers rather than rapid net new client acquisition-this leaves the business acutely exposed to intensifying competition from large cloud and software platforms (e.g., Intuit, Salesforce, Google, ServiceTitan) as well as low-cost disruptors, risking price compression and increased churn that could compress margins.
The Keep acquisition, while generating substantial cost synergies, still faces significant challenges: the acquired business had pre-existing revenue decline trends, is underperforming prior projections, and remains reliant on delayed partner-channel revenue synergies. This heightens the risk that Keep's integration may not yield incremental recurring revenue/ARR, potentially weighing on earnings and net margins if synergies are slower or smaller than expected.
A prolonged period of under-investment in sales/marketing, international expansion, and new channel development as a result of the "pinch point"/deleveraging focus may have allowed competitors to strengthen their market position and brand among SMBs. If investments in go-to-market and product innovation do not ramp swiftly or successfully, the company could face customer acquisition cost (CAC) inflation and be forced into large catch-up spending, which would pressure EBITDA margins and free cash flow.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $21.75 for Thryv Holdings based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $26.0, and the most bearish reporting a price target of just $16.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $634.2 million, earnings will come to $162.6 million, and it would be trading on a PE ratio of 8.3x, assuming you use a discount rate of 7.6%.
Given the current share price of $12.41, the analyst price target of $21.75 is 42.9% higher.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

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