Intellinetics (INLX) AI Stock Analysis

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Intellinetics

(NYSE MKT:INLX)

66Neutral

Intellinetics shows strong growth potential with robust revenue and cash flow management. However, profitability challenges and a negative P/E ratio impact the overall score. Technical indicators suggest caution due to overbought conditions, while strategic investments and market expansions provide positive sentiment.

Intellinetics (INLX) vs. S&P 500 (SPY)

Market Cap

$59.54M

Dividend YieldN/A

Average Volume (3M)6.23K

Price to Earnings (P/E)―

Beta (1Y)<0.01

Revenue Growth6.70%

EPS Growth-202.12%

CountryUS

Employees138

SectorTechnology

Sector Strength49

IndustrySoftware - Application

Share Statistics

EPS (TTM)-0.13

Shares Outstanding4,259,276

10 Day Avg. Volume4,687

30 Day Avg. Volume6,226

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)2.62

Price to Cash Flow (P/CF)6.10

P/FCF Ratio6.80

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Intellinetics Business Overview & Revenue Model

Company DescriptionIntellinetics, Inc. designs, develops, tests, markets, and licenses document services and software solutions in the United States. The company operates in two segments, Document Management and Document Conversion. Its software platform allows its customers to capture and manage documents across operations, such as scanned hard-copy documents and digital documents, including Microsoft Office 365, digital images, audios, videos, and emails. The company's flagship software suite includes IntelliCloud platform that comprises image processing modules, records management, workflow, and extended components. It also provides installation, integration, training, and consulting services; ongoing software maintenance and customer support services; and digital scanning, microfilm and microfiche, box storage, scanning equipment, and software and repair services, as well as long-term paper and microfilm storage, and retrieval option services. In addition, the company offers business process outsourcing services. Intellinetics, Inc. sells its products to resellers and directly to customers, as well as provides access to its software solutions as a service through the Internet. It serves business and federal, county, and municipal governments, as well as healthcare, K-12 education, public safety, other public sector, risk management, financial services, and others. The company was formerly known as GlobalWise Investments, Inc. and changed its name to Intellinetics, Inc. in September 2014. Intellinetics, Inc. was incorporated in 1996 and is headquartered in Columbus, Ohio.

How the Company Makes MoneyIntellinetics generates revenue primarily through the sale and implementation of its enterprise content management (ECM) solutions. The company earns money by licensing its software products to businesses and organizations. Revenue streams include subscription fees for its cloud-based ECM services, one-time fees for software licenses, and charges for professional services such as installation, customization, and ongoing support. Additionally, Intellinetics may engage in partnerships with resellers and other technology providers to expand its market reach and enhance its solution offerings.

Intellinetics Financial Statement Overview

Summary

Intellinetics is demonstrating strong revenue growth and excellent cash flow management. Despite these positives, the company is experiencing net losses, which affects profitability metrics. The balance sheet is stable with manageable leverage, yet improvements in profitability are needed.

Income Statement

Positive

Intellinetics has shown impressive revenue growth with a growth rate of 6.8% from 2023 to 2024. Despite this, the company experienced a net loss in 2024, resulting in a negative net profit margin. The gross profit margin remains robust at 63.96%, indicating strong product profitability. However, challenges are evident in operating efficiencies as seen with the negative EBIT margin. Positively, the EBITDA margin is healthy at 5.30%, reflecting improved cash operating profit.

Balance Sheet

Positive

The balance sheet reflects a stable equity position with an equity ratio of 57.23%, showing financial stability. The debt-to-equity ratio stands at 0.38, indicating a manageable level of leverage. However, a return on equity of -5.14% highlights profitability challenges. The company's ability to manage its liabilities effectively is a positive sign, though profitability improvements are necessary.

Cash Flow

Very Positive

Intellinetics exhibits strong cash flow management with a significant increase in free cash flow, growing 1,344% from 2023 to 2024. The operating cash flow to net income ratio of -7.06 reflects cash generation strength despite net losses, and the free cash flow to net income ratio is an impressive -6.26. These metrics suggest effective cash flow management and potential for reinvestment or debt reduction.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
18.02M	16.89M	14.02M	11.46M	8.25M
	Gross Profit
11.52M	9.59M	8.91M	6.94M	4.99M
	EBIT
-173.50K	1.11M	1.27M	964.99K	153.00K
	EBITDA
955.11K	2.08M	1.55M	2.86M	-1.05M
	Net Income Common Stockholders
-546.22K	519.27K	-779.27K	905.83K	-2.20M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.49M	1.22M	2.70M	1.75M	1.91M
	Total Assets
18.57M	19.03M	19.94M	11.96M	10.34M
	Total Debt
4.07M	5.65M	7.02M	5.69M	5.10M
	Net Debt
1.58M	4.44M	4.33M	3.93M	3.19M
	Total Liabilities
7.94M	9.28M	11.37M	9.30M	9.19M
	Stockholders Equity
10.63M	9.75M	8.57M	2.66M	1.15M
Cash Flow		Free Cash Flow
3.42M	236.58K	1.41M	799.48K	48.13K
	Operating Cash Flow
3.86M	784.66K	1.99M	1.39M	124.99K
	Investing Cash Flow
-827.77K	-548.08K	-6.96M	-590.49K	-4.10M
	Financing Cash Flow
-1.76M	-1.72M	5.92M	-954.73K	5.47M

Intellinetics Technical Analysis

Technical Analysis Sentiment

Positive

Last Price13.98

Price Trends

50DMA

12.36

Positive

100DMA

13.10

Positive

200DMA

11.69

Positive

Market Momentum

MACD

-0.05

Negative

RSI

57.70

Neutral

STOCH

85.13

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For INLX, the sentiment is Positive. The current price of 13.98 is above the 20-day moving average (MA) of 12.57, above the 50-day MA of 12.36, and above the 200-day MA of 11.69, indicating a bullish trend. The MACD of -0.05 indicates Negative momentum. The RSI at 57.70 is Neutral, neither overbought nor oversold. The STOCH value of 85.13 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for INLX.

Intellinetics Risk Analysis

Intellinetics disclosed 42 risk factors in its most recent earnings report. Intellinetics reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Intellinetics Peers Comparison

Overall Rating

UnderperformOutperform

Sector (57)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DOCU	77 Outperform	$15.06B	14.54	68.18%	―	7.78%	1345.45%
BOX	72 Outperform	$4.34B	22.49	189.40%	―	5.05%	103.11%
LFVN	71 Outperform	$177.48M	25.02	25.67%	1.13%	0.57%	155.00%
INLX	66 Neutral	$59.54M	―	-5.36%	―	6.70%	-202.12%
Sector *	57 Neutral	$19.95B	9.66	-12.09%	2.76%	5.40%	-24.89%
EGHT	51 Neutral	$215.98M	―	-40.78%	―	-2.23%	19.48%

* Technology Sector Average

Performance Comparison

INLX

Intellinetics

13.98

7.17

105.29%

EGHT

8X8

1.64

-0.62

-27.43%

OTEX

Open Text

25.15

-8.35

-24.93%

LFVN

LifeVantage

14.14

8.47

149.38%

BOX

Box

30.21

3.94

15.00%

DOCU

DocuSign

74.35

17.68

31.20%

Intellinetics Earnings Call Summary

Earnings Call Date: Mar 24, 2025 | % Change Since: 25.95% | Next Earnings Date: May 19, 2025

Earnings Call Sentiment Neutral

The earnings call presents a mixed picture with significant revenue growth, strong cash flow, and successful product launches in new markets. However, the company experienced a net loss for both the quarter and the full year, with reduced EBITDA due to increased expenses. The sentiment leans towards positive due to strategic investments and growth potential despite short-term financial challenges.

Highlights

Increase in Total Revenue

Total revenue for 2024 increased by 6.7%, reaching $18 million compared to $16.9 million last year.

Growth in SaaS Revenue

SaaS revenue increased by 10.8% for the full year, and by 11.8% in Q4 2024, primarily driven by early payables automation successes.

Record Professional Services Revenue

Professional services revenue increased by 8.9% for the year, reaching a record $10 million compared to $9.2 million last year.

Improved Gross Margin

Consolidated gross margin increased to 64% for the year from 62.6% last year, and to 65.8% in Q4 from 64.9% the previous year.

Strong Cash Flow Generation

Cash provided by operating activities was $3.9 million, allowing for the prepayment of $1.6 million in debt.

Successful Launch of Payables Automation Solution

High customer acceptance of the Payables Automation Solution, with notable successes such as processing over 11,000 invoices monthly with zero human intervention.

Expansion into K-12 Market

Payables Automation Solution launched into the K-12 market, with successful implementations and a growing pipeline.

Lowlights

Net Loss for Q4 and Full Year

Net loss for Q4 was $54,000 compared to net income of $62,000 last year. Full year net loss was $546,000 compared to net income of $519,000 last year.

Reduction in EBITDA Due to Increased Expenses

Adjusted EBITDA for Q4 decreased to $601,000 from $754,000 last year, and full year adjusted EBITDA was $2.5 million, down from $2.7 million in 2023, due to increased sales and marketing expenses.

Decrease in Software Maintenance Services Revenue

Software maintenance services revenue decreased by 2.5% compared to 2023.

Increased Operating Expenses

Operating expenses increased by 23.7% for the year, primarily due to investments in sales and marketing and increased share-based compensation.

Company Guidance

During the Intellinetics Fourth Quarter and Full Year 2024 Earnings Call, the company provided several key metrics and guidance for the upcoming year. Intellinetics reported a 2.1% increase in total revenue for Q4 2024, reaching $4.3 million, with SaaS revenue up by 11.8% to $1.5 million. Their professional services revenue remained flat at $2.2 million, while consolidated gross margin improved to 65.8%, an 88 basis point increase from the previous year. The company experienced a net loss of $54,000 for Q4, compared to a net income of $62,000 in the prior year, largely due to increased sales and marketing expenses. For fiscal 2025, Intellinetics expects year-over-year revenue growth but anticipates a reduction in EBITDA by more than half due to continued investments in sales and marketing. The company highlighted its strategic focus on expanding its Payables Automation Solution, particularly in the K-12 and homebuilder markets, and plans to release a new purchase order solution to further drive revenue growth.

Intellinetics Corporate Events

Executive/Board Changes

Intellinetics Board Member Ari Kahn Resigns

Neutral

Feb 20, 2025

On February 18, 2025, Roger “Ari” Kahn resigned from Intellinetics, Inc.’s board of directors, citing demands from his primary occupation as the reason, not any disagreement with the company. Kahn’s departure from roles including Audit Committee member and Chair of the Nominating and Corporate Governance Committee can impact the company’s board dynamics.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.