EverCommerce Inc. (NASDAQ:EVCM): Are Analysts Optimistic?

We feel now is a pretty good time to analyse EverCommerce Inc.'s (NASDAQ:EVCM) business as it appears the company may be on the cusp of a considerable accomplishment. EverCommerce Inc., together with its subsidiaries, engages in providing integrated software-as-a-service solutions for service-based small and medium sized businesses in the United States and internationally. On 31 December 2021, the US$2.6b market-cap company posted a loss of US$97m for its most recent financial year. The most pressing concern for investors is EverCommerce's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for EverCommerce

Consensus from 11 of the American Software analysts is that EverCommerce is on the verge of breakeven. They expect the company to post a final loss in 2022, before turning a profit of US$1.5m in 2023. Therefore, the company is expected to breakeven just over a year from today. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 120%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of EverCommerce's upcoming projects, though, keep in mind that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one issue worth mentioning. EverCommerce currently has a relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in EverCommerce's case is 55%. Note that a higher debt obligation increases the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of EverCommerce which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at EverCommerce, take a look at EverCommerce's company page on Simply Wall St. We've also put together a list of essential factors you should look at:

1. Valuation: What is EverCommerce worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether EverCommerce is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on EverCommerce’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.