Analyst Rufus Hone from BMO Capital maintained a Hold rating on I3 Verticals (IIIV – Research Report) and keeping the price target at $25.00.
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Rufus Hone has given his Hold rating due to a combination of factors influencing I3 Verticals’ current financial outlook. The company’s recent fiscal results showed a slight underperformance in revenue and adjusted EBITDA compared to expectations, which was partly due to macroeconomic challenges and delays in a significant contract. Despite these setbacks, the organic revenue growth remained aligned with long-term targets, suggesting stability in the company’s core operations.
Additionally, the revised guidance for FY2025 reflects a decrease, primarily due to the divestiture of the Healthcare RCM business and external trade pressures. However, the acquisition of a utility billing software business is expected to positively impact the company’s growth trajectory. While I3 Verticals is well-positioned for future growth with a strong cash position and potential for further M&A activities, the lack of a clear catalyst for a significant re-rating of the stock justifies the Hold recommendation.