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Emerge Commerce Ltd (TSE:ECOM)
:ECOM
Canadian Market

Emerge Commerce Ltd (ECOM) AI Stock Analysis

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Emerge Commerce Ltd

(ECOM)

Rating:51Neutral
Price Target:
C$0.00
▼(-100.00%Downside)
Emerge Commerce Ltd's overall stock score reflects a challenging financial performance, mitigated by positive corporate actions and some favorable technical indicators. The company's strategic initiatives and recent operational improvements are promising, but financial instability and valuation concerns weigh heavily on the score.

Emerge Commerce Ltd (ECOM) vs. iShares MSCI Canada ETF (EWC)

Emerge Commerce Ltd Business Overview & Revenue Model

Company DescriptionEmerge Commerce Ltd (ECOM) is a leading digital commerce company that operates in the e-commerce and online marketplace sectors. The company focuses on acquiring and operating niche e-commerce brands and platforms, offering a diverse range of products and services. Emerge Commerce Ltd aims to provide value-driven and unique shopping experiences to its customers through its portfolio of e-commerce websites.
How the Company Makes MoneyEmerge Commerce Ltd makes money through a diversified revenue model that includes direct sales from its e-commerce platforms, subscription services, and transaction fees. The company generates revenue by acquiring niche e-commerce brands and leveraging their existing customer base and market presence. Key revenue streams include the sale of goods and services through its various online platforms, membership and subscription fees for premium offerings, and commission fees from third-party vendors or partners that sell on its platforms. Significant partnerships with suppliers and vendors allow Emerge to offer exclusive products and deals, further enhancing its revenue potential. The company's focus on operational efficiencies and cross-platform synergies also contributes to its profitability.

Emerge Commerce Ltd Earnings Call Summary

Earnings Call Date:May 28, 2025
(Q3-2024)
|
% Change Since: 0.00%|
Next Earnings Date:Sep 01, 2025
Earnings Call Sentiment Positive
The earnings call highlighted significant positive trends in GMS growth, revenue increase, and improved profitability metrics, complemented by a strong debt reduction strategy. However, the continued negative adjusted EBITDA and net loss from operations indicate areas needing further improvement. Overall, the positive aspects and strategic shifts outweigh the negatives.
Q3-2024 Updates
Positive Updates
Gross Merchandise Sales (GMS) Growth
GMS accelerated to 10% organic growth year-over-year, reaching $7.4 million in Q3 2024 compared to $6.8 million in Q3 2023.
Revenue Increase
Revenue increased to $4.6 million in Q3 2024 from $4.4 million in Q3 2023, marking a 5% increase. Excluding Carnivore Club, revenue grew approximately 8%.
Improvement in Gross Margin
Gross margin improved to 39.3% in Q3 2024 from 38.9% in Q3 2023, driven by initiatives like price increases and renegotiated vendor costs.
Reduction in Adjusted EBITDA Losses
Adjusted EBITDA losses reduced to $280,000 in Q3 2024 from $560,000 in Q3 2023, attributed to revenue growth, improved gross margin, and reduced expenses.
Debt Reduction and Improved Financial Standing
Senior debt facility reduced to $5.85 million from $15.85 million, with a net debt position approaching $5.5 million, down from $27.8 million.
Negative Updates
Adjusted EBITDA Still Negative
Despite improvements, adjusted EBITDA remains negative at $280,000 for Q3 2024.
Net Loss from Continuing Operations
Net loss from continuing operations was $0.7 million in Q3 2024, slightly decreased from $0.8 million in the prior year.
Company Guidance
During the Q3 2024 earnings call for EMERGE Commerce, CEO Ghassan Halazon and CFO Kyle Burt-Gerrans provided a comprehensive overview of the company's financial performance and strategic direction. Key highlights included a 10% increase in gross merchandise sales (GMS) year-over-year, reaching $7.4 million, and a 5% rise in revenue to $4.6 million. Excluding the Carnivore Club, revenue grew by 8%. The company reported a gross profit increase of over 6% to $1.8 million, with gross margins improving to 39.3%. Adjusted EBITDA losses were reduced by approximately half compared to the previous year, coming in at negative $280,000. Additionally, EMERGE achieved significant debt reduction, bringing net debt down to $5.5 million after a $10 million debt paydown. The company also implemented cost reductions expected to yield $500,000 in annual savings, which will be fully realized in 2025. These efforts underscore EMERGE's focus on organic growth, operational efficiency, and enhanced profitability as they transition into the new year.

Emerge Commerce Ltd Financial Statement Overview

Summary
Emerge Commerce Ltd's financial performance is concerning, with declining revenues, persistent losses, high leverage, and negative equity. These factors indicate financial instability and significant operational challenges.
Income Statement
30
Negative
Emerge Commerce Ltd has experienced volatile revenue growth with a significant decline in recent years, and the company is operating at a net loss. The negative EBIT and EBITDA margins indicate operational inefficiencies and challenges in managing costs relative to revenue. Overall, the income statement reflects financial instability and operational challenges.
Balance Sheet
20
Very Negative
The balance sheet reveals a concerning financial structure with negative stockholders' equity, indicating that liabilities exceed assets. The high debt-to-equity ratio suggests significant leverage, which poses a risk in terms of financial sustainability. The negative equity ratio further highlights the company's financial distress.
Cash Flow
40
Negative
Cash flow analysis shows sporadic free cash flow generation with negative operating cash flows in the latest period. The company's ability to convert net income into cash flow is weak, which may hinder future growth and investment capabilities. The reliance on external financing is evident, affecting cash flow stability.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
20.42M23.83M58.17M34.83M9.20M
Gross Profit
8.02M11.88M23.79M15.11M7.17M
EBIT
-895.49K-3.13M-4.21M-4.37M-2.56M
EBITDA
908.43K-15.66M-4.41M-1.16M-1.03M
Net Income Common Stockholders
-1.03M-21.26M-17.38M-6.56M-4.43M
Balance SheetCash, Cash Equivalents and Short-Term Investments
3.16M2.54M5.88M7.77M12.39M
Total Assets
7.80M22.99M59.75M80.28M43.46M
Total Debt
6.96M18.25M25.98M24.50M7.68M
Net Debt
3.80M15.71M20.10M16.74M-4.72M
Total Liabilities
16.63M32.86M49.63M53.27M25.38M
Stockholders Equity
-8.83M-9.87M10.11M27.00M18.07M
Cash FlowFree Cash Flow
-1.00M2.02M1.02M-3.47M-254.43K
Operating Cash Flow
-997.97K2.03M1.06M-3.43M-186.11K
Investing Cash Flow
11.73M7.10M-44.60K-27.34M-5.61M
Financing Cash Flow
-10.29M-9.55M-3.09M26.18M9.54M

Emerge Commerce Ltd Technical Analysis

Technical Analysis Sentiment
Positive
Last Price0.05
Price Trends
50DMA
0.04
Positive
100DMA
0.05
Positive
200DMA
0.05
Positive
Market Momentum
MACD
<0.01
Positive
RSI
65.46
Neutral
STOCH
83.33
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ECOM, the sentiment is Positive. The current price of 0.05 is above the 20-day moving average (MA) of 0.05, above the 50-day MA of 0.04, and above the 200-day MA of 0.05, indicating a bullish trend. The MACD of <0.01 indicates Positive momentum. The RSI at 65.46 is Neutral, neither overbought nor oversold. The STOCH value of 83.33 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:ECOM.

Emerge Commerce Ltd Peers Comparison

Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
77
Outperform
C$447.46M91.708.21%34.10%
62
Neutral
$6.82B11.052.80%4.32%2.67%-24.92%
51
Neutral
C$7.11M204.61%-10.48%94.56%
46
Neutral
C$5.54M
-36.77%83.80%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:ECOM
Emerge Commerce Ltd
0.05
>-0.01
-16.67%
TSE:NTAR
NexTech AR Solutions
0.03
-0.07
-70.00%
TSE:KITS
Kits Eyecare
13.48
5.50
68.92%

Emerge Commerce Ltd Corporate Events

Executive/Board Changes
EMERGE Commerce Ltd. Cancels Director’s RSUs
Neutral
Jun 9, 2025

EMERGE Commerce Ltd. announced the cancellation of 557,692 restricted share units (RSUs) previously granted to a director, leaving a balance of 557,693 RSUs maturing in 2025. This action does not affect other RSU holders or alter the company’s fixed equity incentive plan, indicating a targeted adjustment rather than a broader policy change.

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
EMERGE Commerce Ltd. Achieves Positive EBITDA and Eyes Further Growth
Positive
May 28, 2025

EMERGE Commerce Ltd. reported strong financial results for Q1 2025, marking its fourth consecutive quarter of organic revenue growth and achieving positive Adjusted EBITDA for the first time under its EMERGE 2.0 strategy. The company anticipates continued growth in Q2 2025, driven by the recent acquisition of Tee 2 Green, a profitable discount golf business, which is expected to enhance revenue, profitability, and cash flow. The sale of non-core asset Carnivore Club and refinancing of debt are strategic moves to strengthen its financial position, with the company focusing on accelerating revenue growth and improving its cost of capital.

Financial Disclosures
EMERGE Commerce Ltd. to Announce Q1 2025 Financial Results
Neutral
May 20, 2025

EMERGE Commerce Ltd. has announced that it will release its first quarter 2025 financial results on May 28, 2025, before the market opens. The company will also host a conference call on the same day to discuss these results, led by CEO Ghassan Halazon and CFO Dasha Enenko. This announcement is significant for stakeholders as it provides insights into the company’s financial health and strategic direction in the competitive e-commerce sector.

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Emerge Commerce Ltd Achieves Strong Growth and Strategic Expansion in 2024
Positive
Apr 28, 2025

Emerge Commerce Ltd reported strong financial results for Q4 and the full year 2024, marking its third consecutive quarter of organic revenue growth and a return to growth for the fiscal year. The company achieved significant improvements in profitability, including a positive net income in Q4, and increased its cash balance without raising additional capital. The sale of Carnivore Club and the acquisition of Tee 2 Green are strategic moves to streamline operations and focus on more profitable segments. The acquisition of Tee 2 Green, a profitable golf apparel and equipment business, is expected to enhance Emerge’s existing golf-related ventures. Additionally, the company refinanced its debt, which, along with anticipated interest rate cuts, is expected to result in cash savings.

Financial Disclosures
EMERGE Commerce Ltd. to Announce Q4 and Full Year 2024 Financial Results
Neutral
Apr 23, 2025

EMERGE Commerce Ltd. has announced the release of its fourth quarter and full year 2024 audited financial results, scheduled for April 28, 2025. The company will host a conference call on the same day to discuss these results, indicating a proactive approach to engaging with stakeholders and providing transparency about its financial performance.

M&A TransactionsBusiness Operations and Strategy
EMERGE Commerce Ltd. Hosts Webcast to Discuss Strategic Developments
Neutral
Apr 10, 2025

EMERGE Commerce Ltd. announced that its Founder and CEO, Ghassan Halazon, along with EMERGE Golf COO, Maurice Finn, will host a virtual corporate presentation to discuss the company’s recent acquisition, operational progress, and future plans. This webcast is an opportunity for EMERGE to engage with investors and provide insights into its strategic direction, potentially impacting its market position and stakeholder interests.

M&A TransactionsBusiness Operations and Strategy
EMERGE Commerce Strengthens Golf Portfolio with Tee 2 Green Acquisition
Positive
Apr 7, 2025

EMERGE Commerce Ltd. has completed the acquisition of Tee 2 Green Ltd., a Canadian discount golf apparel and equipment business, for $2.2 million. This acquisition is expected to make EMERGE cash flow positive and enhance its golf brand portfolio by leveraging synergies and an extensive subscriber database. The transaction was funded using cash on hand, bolstered by recent asset sales, and involves a combination of cash, deferred payments, and shares. The integration of Tee 2 Green is anticipated to strengthen EMERGE’s position in the golf industry, offering expanded products and experiences both online and offline.

M&A TransactionsBusiness Operations and Strategy
EMERGE Commerce Acquires Tee 2 Green to Boost Golf Vertical
Positive
Mar 27, 2025

EMERGE Commerce Ltd. has signed a definitive agreement to acquire Tee 2 Green Ltd., a profitable golf apparel and equipment business based in Ontario, Canada. The acquisition, valued at $2.2 million, is expected to bring EMERGE to a cash flow positive position by 2025. Tee 2 Green, with a 38-year track record, will benefit from EMERGE’s extensive golf business and subscriber database, enhancing its market reach and operational efficiency. The deal is strategically significant for EMERGE as it expands its golf vertical, which includes successful brands like UnderPar and JustGolfStuff. The acquisition is funded with cash on hand, reflecting EMERGE’s strengthened financial position following recent asset sales.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.