I3 Verticals (IIIV) Stock Forecast & Price Target

i3 Verticals Inc is projected to experience a robust adjusted EBITDA growth of 2%-13% year-over-year, reaching between $58.5 million and $65.0 million, with stable to improved margins anticipated for fiscal 2025. The company has demonstrated a strong recurring revenue growth of 9% year-over-year on a pro forma basis, accounting for 75% of total revenue, which underscores its solid subscription-based business model. Additionally, the company's expansion efforts through a favorable M&A pipeline enhance its market position and enable it to capture share from smaller regional competitors, supporting a positive financial outlook.

i3 Verticals Inc experienced a 2% year-over-year decline in Non-GAAP EBITDA, totaling $14.4 million, which was 5% below internal forecasts despite being above consensus estimates. The company is facing challenges due to a significant drop of 76% year-over-year in high-margin software license fees, coupled with a decline in non-recurring professional services revenue, highlighting vulnerabilities in its revenue streams. Furthermore, the firm's slower-than-expected growth in key verticals and the inadequate addition of independent software vendors (ISVs) to its distribution network have contributed to an overall negative outlook on organic growth potential.