Vertex, Inc. (VERX) Stock Forecast & Price Target

Vertex Inc. demonstrated robust performance with cloud revenue reaching approximately $92.0 million, reflecting a consistent 30% year-over-year growth, which aligns with its previous quarter's performance. The company also reported a significant increase in annual recurring revenue per customer, rising 12% year-over-year to $133.5 million, further highlighting the effectiveness of its subscription model. Additionally, despite increased investments in AI and eInvoicing, Vertex achieved an expansion in adjusted EBITDA margin to 23%, underscoring its improving operational efficiency and resilience in generating profit.

Vertex Inc. has experienced stagnation in its direct customer count, remaining flat year-over-year while decreasing sequentially, indicating potential challenges in customer retention and growth. The company's revised full-year revenue guidance reflects a cautious outlook, with a approximately $12 million reduction at the midpoint, resulting in implied revenue growth for 2025 lower than previously anticipated due to slowing deal cycles and lower entitlement growth. Additionally, the company's net revenue retention rate has declined, compounded by industry-specific adversities such as retail bankruptcies leading to contract cancellations, which further illuminate the pressures Vertex faces in maintaining a stable revenue stream.