NasdaqGS:IIIV

Stock Analysis Report

Executive Summary

i3 Verticals, Inc. provides integrated payment and software solutions to small- and medium-sized businesses and organizations in education, non-profit, public sector, property management, and healthcare markets in the United States.

Rewards

Trading at 63.8% below its fair value

Earnings are forecast to grow 69.14% per year

Revenue grew by 16.3% over the past year

Risk Analysis

Highly volatile share price over past 3 months

Shareholders have been diluted in the past year



Snowflake Analysis

Moderate growth potential and slightly overvalued.


Similar Companies

Share Price & News

How has i3 Verticals's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: IIIV's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

1.2%

IIIV

0.3%

US IT

-1.2%

US Market


1 Year Return

34.0%

IIIV

40.2%

US IT

22.3%

US Market

Return vs Industry: IIIV underperformed the US IT industry which returned 42.8% over the past year.

Return vs Market: IIIV exceeded the US Market which returned 24.7% over the past year.


Shareholder returns

IIIVIndustryMarket
7 Day1.2%0.3%-1.2%
30 Day13.7%6.1%1.6%
90 Day52.9%13.9%8.8%
1 Year34.0%34.0%41.6%40.2%25.0%22.3%
3 Yearn/a109.8%100.7%49.9%40.3%
5 Yearn/a159.8%136.9%77.6%58.0%

Price Volatility Vs. Market

How volatile is i3 Verticals's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is i3 Verticals undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: IIIV ($30.8) is trading below our estimate of fair value ($85.17)

Significantly Below Fair Value: IIIV is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: IIIV is unprofitable, so we can't compare its PE Ratio to the IT industry average.

PE vs Market: IIIV is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate IIIV's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: IIIV is overvalued based on its PB Ratio (5.6x) compared to the US IT industry average (4.2x).


Next Steps

Future Growth

How is i3 Verticals forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

70.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: IIIV is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.7%).

Earnings vs Market: IIIV is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: IIIV's is expected to become profitable in the next 3 years.

Revenue vs Market: IIIV's revenue is expected to decline over the next 3 years (-34.8% per year).

High Growth Revenue: IIIV's revenue is forecast to decline over the next 3 years (-34.8% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if IIIV's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has i3 Verticals performed over the past 5 years?

55.9%

Last years earnings growth


Earnings and Revenue History

Quality Earnings: IIIV is currently unprofitable.

Growing Profit Margin: IIIV is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if IIIV's year-on-year earnings growth rate was positive over the past 5 years.

Accelerating Growth: Unable to compare IIIV's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: IIIV is unprofitable, making it difficult to compare its past year earnings growth to the IT industry (16.2%).


Return on Equity

High ROE: IIIV has a negative Return on Equity (0.4%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is i3 Verticals's financial position?


Financial Position Analysis

Short Term Liabilities: IIIV's short term assets ($20.6M) do not cover its short term liabilities ($35.2M).

Long Term Liabilities: IIIV's short term assets ($20.6M) do not cover its long term liabilities ($171.6M).


Debt to Equity History and Analysis

Debt Level: IIIV's debt to equity ratio (97.8%) is considered high.

Reducing Debt: Insufficient data to determine if IIIV's debt to equity ratio has reduced over the past 5 years.


Balance Sheet

Inventory Level: IIIV has a low level of unsold assets or inventory.

Debt Coverage by Assets: IIIV's debt is not covered by short term assets (assets are 0.1x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable IIIV has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: IIIV is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 34.8% per year.


Next Steps

Dividend

What is i3 Verticals's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage1.2%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate IIIV's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate IIIV's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if IIIV's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if IIIV's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of IIIV's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of i3 Verticals's salary, the management and board of directors tenure and is there insider trading?

2.0yrs

Average management tenure


CEO

Greg Daily (59yo)

2yrs

Tenure

US$22,346

Compensation

Mr. Gregory S. Daily, also known as Greg, serves as the Founder, Chairman and Chief Executive Officer of i3 Verticals, LLC. since 2012. Mr. Daily serves as Chairman and Chief Executive Officer at i3 Vertic ...


CEO Compensation Analysis

Compensation vs Market: Greg's total compensation ($USD22.35K) is below average for companies of similar size in the US market ($USD2.53M).

Compensation vs Earnings: Greg's compensation has increased whilst the company is unprofitable.


Management Age and Tenure

2.0yrs

Average Tenure

54yo

Average Age

Experienced Management: IIIV's management team is considered experienced (2 years average tenure).


Board Age and Tenure

2.7yrs

Average Tenure

62yo

Average Age

Experienced Board: IIIV's board of directors are not considered experienced ( 2.7 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: IIIV insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$83,70009 Dec 19
David Meriwether
EntityIndividual
Role
Chief Operating Officer
Chief Operating Officer
Shares3,000
Max PriceUS$27.90
BuyUS$42,70013 Aug 19
David Morgan
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares2,000
Max PriceUS$21.35
BuyUS$1,991,95212 Jun 19
Gregory Daily
EntityIndividual
Role
Chief Executive Officer
Chairman & CEO
Shares84,800
Max PriceUS$23.49

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 19%.


Management Team

  • Greg Daily (59yo)

    Chairman & CEO

    • Tenure: 2yrs
    • Compensation: US$22.35k
  • Clay Whitson (62yo)

    CFO & Director

    • Compensation: US$628.96k
  • Rick Stanford (58yo)

    President

    • Tenure: 2yrs
    • Compensation: US$672.93k
  • Rob Bertke (50yo)

    Chief Technology Officer

    • Tenure: 1.8yrs
  • Hume Miller

    Chief Executive Officer of Data Business Systems

    • Ian Halpern

      Chief Executive Officer of Rentshare

      • Paul Maple (45yo)

        General Counsel & Secretary

        • Tenure: 2yrs
      • David Meriwether (37yo)

        Chief Operating Officer

        • Tenure: 0.2yrs

      Board Members

      • John Harrison

        Independent Director

        • Tenure: 6.4yrs
        • Compensation: US$41.27k
      • Greg Daily (59yo)

        Chairman & CEO

        • Tenure: 2yrs
        • Compensation: US$22.35k
      • Clay Whitson (62yo)

        CFO & Director

        • Compensation: US$628.96k
      • David Wilds (78yo)

        Lead Independent Director

        • Compensation: US$41.27k
      • Robert Harvey (55yo)

        Independent Director

        • Tenure: 3.4yrs
        • Compensation: US$41.27k
      • David Morgan (66yo)

        Independent Director

        • Tenure: 1.8yrs
        • Compensation: US$175.09k
      • Beth Courtney (55yo)

        Independent Director

        • Tenure: 1.7yrs
        • Compensation: US$172.59k
      • Tim McKenna (65yo)

        Independent Director

        • Tenure: 8yrs
        • Compensation: US$43.77k

      Company Information

      i3 Verticals, Inc.'s company bio, employee growth, exchange listings and data sources


      Key Information

      • Name: i3 Verticals, Inc.
      • Ticker: IIIV
      • Exchange: NasdaqGS
      • Founded: 2012
      • Industry: Data Processing and Outsourced Services
      • Sector: Software
      • Implied Market Cap: US$883.390m
      • Market Cap: US$467.701m
      • Shares outstanding: 27.46m
      • Website: https://www.i3verticals.com

      Number of Employees


      Location

      • i3 Verticals, Inc.
      • 40 Burton Hills Boulevard
      • Suite 415
      • Nashville
      • Tennessee
      • 37215
      • United States

      Listings

      TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
      IIIVNasdaqGS (Nasdaq Global Select)YesClass A Common StockUSUSDJun 2018
      V1KMUN (Boerse Muenchen)YesClass A Common StockDEEURJun 2018

      Biography

      i3 Verticals, Inc. provides integrated payment and software solutions to small- and medium-sized businesses and organizations in education, non-profit, public sector, property management, and healthcare markets in the United States. It operates in two segments, Merchant Services and Proprietary Software and Payments. The company offers payment processing services, including merchant onboarding, risk and underwriting, authorization, settlement, chargeback processing, and other merchant support. Its payment processing services enable clients to accept electronic payments, facilitating the exchange of funds and transaction data between clients, financial institutions, and payment networks. The company also licenses software; and provides ongoing support, and other point of sale-related solutions. It offers its solutions to its clients through direct sales force, as well as through a network of distribution partners, including independent software vendors, value-added resellers, independent sales organizations, and other referral partners, such as financial institutions. The company was founded in 2012 and is headquartered in Nashville, Tennessee. 


      Company Analysis and Financial Data Status

      All financial data provided by Standard & Poor's Capital IQ.
      DataLast Updated (UTC time)
      Company Analysis2020/01/27 01:08
      End of Day Share Price2020/01/24 00:00
      Earnings2019/09/30
      Annual Earnings2019/09/30


      Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.