VerticalScope Holdings (FORA) AI Stock Analysis

• Market Cap: C$66.46M
• Dividend Yield: N/A
• Average Volume (3M): 17.39K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.81
• Revenue Growth: -4.04%
• EPS Growth: -297.93%
• Country: CA
• Employees: 191
• Sector: Communication Services
• Sector Strength: 97
• Industry: Internet Content & Information
• EPS (TTM): -0.03
• Shares Outstanding: 18,552,359
• 10 Day Avg. Volume: 11,327
• 30 Day Avg. Volume: 17,389
• PEG Ratio: 97.24
• Price to Book (P/B): 1.86
• Price to Sales (P/S): 2.23
• P/FCF Ratio: 6.80
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$5.13
• Price Target Upside: 66.02% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 2
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 49 Neutral
• Price Target: C$3.00 ▼(-2.91% Downside)

The overall stock score reflects the company's financial challenges, including declining revenue and profitability, and a bearish technical outlook. However, positive elements from the earnings call, such as improvements in user engagement and e-commerce growth, provide some optimism. The lack of profitability and negative valuation metrics weigh heavily on the score.

Positive Factors

E-commerce Revenue Growth

The significant growth in e-commerce revenue indicates successful strategic acquisitions and a robust expansion in digital sales, enhancing long-term revenue streams.

AI Initiatives and Product Innovations

The focus on AI-driven tools suggests a commitment to innovation, potentially improving user engagement and operational efficiency, supporting future growth.

Strong Balance Sheet and Liquidity Position

A strong liquidity position provides the company with flexibility for strategic investments and acquisitions, supporting long-term growth and stability.

Negative Factors

Decline in Revenue

The significant decline in revenue and MAU suggests challenges in maintaining user engagement and monetization, potentially impacting future revenue stability.

Challenges with Programmatic Advertising

The drop in programmatic advertising revenue highlights difficulties in this key revenue stream, which could affect overall profitability if not addressed.

Net Loss for the Quarter

Reporting a net loss indicates financial challenges, which may hinder the company's ability to invest in growth initiatives and affect investor confidence.

VerticalScope Holdings Business Overview & Revenue Model

Company Description

VerticalScope Holdings Inc., a technology company, operates a cloud-based digital community platform in Canada. It provides digital advertising services, including direct advertising campaigns, custom content solutions, and programmatic advertising; and e-commerce solutions. The company also focus on hyper-specific subjects that engender strong affinity from online communities of enthusiasts, super fans, experts, pros, hobbyists, and armchair analysts. Its brands include communities for watch geeks, audio nerds, motorheads, fitness-obsessed, mountain bikers, DIYers, deal junkies, and enthusiasts. The company serves approximately 106 million monthly active users and 56 million registered community members in approximately one thousand and two hundred online communities. VerticalScope Holdings Inc. was founded in 1999 and is headquartered in Toronto, Canada.

How the Company Makes Money

VerticalScope generates revenue primarily through advertising, which includes display ads, sponsored content, and affiliate marketing partnerships. The company monetizes its extensive user base and high-traffic websites by offering targeted advertising solutions to brands looking to reach specific audiences. Additionally, VerticalScope may engage in strategic partnerships with businesses that align with its community interests, enhancing revenue streams through collaborative marketing efforts. The company also benefits from data analytics, allowing it to optimize ad placements and improve engagement, which in turn boosts revenue potential.

VerticalScope Holdings Financial Statement Overview

Summary

VerticalScope Holdings shows mixed financial performance. Strong gross profit margins and positive cash flow trajectory are offset by declining revenue growth and negative net profitability. The balance sheet reflects moderate leverage but challenges in generating shareholder value.

Income Statement

VerticalScope Holdings shows a mixed performance in its income statement. The company has experienced a decline in revenue growth with a negative growth rate of -3.16% in the TTM period. Gross profit margin is relatively strong at 68.84%, indicating efficient cost management. However, the net profit margin is negative at -2.13%, reflecting ongoing profitability challenges. EBIT and EBITDA margins are modest at 5.30% and 31.45%, respectively, suggesting some operational efficiency but insufficient to drive net profitability.

Balance Sheet

The balance sheet of VerticalScope Holdings indicates moderate financial stability. The debt-to-equity ratio stands at 0.53, showing a manageable level of leverage. However, the return on equity is negative at -1.77%, pointing to challenges in generating returns for shareholders. The equity ratio is not directly provided, but the company maintains a reasonable balance between debt and equity.

Cash Flow

Cash flow analysis reveals a positive trajectory with a 4.22% growth in free cash flow. The operating cash flow to net income ratio is strong at 2.99, indicating good cash generation relative to net income. The free cash flow to net income ratio is 0.65, suggesting that a significant portion of net income is converted into free cash flow, which is a positive sign for liquidity.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	62.65M	69.05M	60.90M	80.49M	65.76M	56.92M
Gross Profit	55.58M	40.96M	34.22M	45.67M	38.95M	35.46M
EBITDA	15.93M	23.68M	18.55M	14.71M	440.34K	23.77M
Net Income	-5.29M	-15.86K	-4.95M	-24.77M	-12.26M	-1.51M
Balance Sheet
Total Assets	133.86M	132.41M	152.95M	177.56M	217.03M	87.68M
Cash, Cash Equivalents and Short-Term Investments	12.38M	5.19M	6.02M	8.77M	20.49M	4.60M
Total Debt	46.06M	40.82M	61.52M	61.64M	84.06M	104.70M
Total Liabilities	56.10M	49.72M	72.27M	96.06M	120.79M	110.23M
Stockholders Equity	77.77M	82.69M	80.69M	81.50M	96.24M	-22.54M
Cash Flow
Free Cash Flow	14.02M	22.61M	13.25M	10.92M	-4.09M	9.39M
Operating Cash Flow	21.13M	24.77M	15.51M	20.64M	19.60M	14.10M
Investing Cash Flow	-11.15M	-2.13M	-17.07M	-9.66M	-87.76M	-3.45M
Financing Cash Flow	-3.38M	-23.38M	-1.13M	-22.47M	84.40M	-11.19M

VerticalScope Holdings Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 3.09
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:FORA, the sentiment is Neutral. The current price of 3.09 is above the 20-day moving average (MA) of 3.08, below the 50-day MA of 3.33, and below the 200-day MA of 4.37, indicating a neutral trend. The MACD of -0.05 indicates Negative momentum. The RSI at 49.95 is Neutral, neither overbought nor oversold. The STOCH value of 48.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:FORA.

VerticalScope Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ZOMD	67 Neutral	C$116.92M	4.79	81.28%	―	50.79%	213.45%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
FORA	49 Neutral	C$66.46M	-9.07	-6.82%	―	-4.04%	-297.93%
EGLX	46 Neutral	$7.96M	-0.06	-183.15%	―	-53.67%	-127.21%
OAM	46 Neutral	C$32.95M	-2.99	-22.90%	―	45.36%	-200.67%

VerticalScope Holdings Corporate Events

VerticalScope Achieves Strong Sequential Growth in Q3 2025

VerticalScope Holdings Inc. reported significant sequential growth in key financial metrics for Q3 2025, including a 21% year-over-year increase in ARPU and a 45% sequential rise in Adjusted EBITDA. Despite a 17% year-over-year revenue decline due to lower MAU, the company saw improvements in monetization and traffic sources, particularly through AI-driven initiatives like the AI-powered community assistant, Fora Frank. The company also achieved a 56% sequential increase in Free Cash Flow, reflecting strong operational efficiencies and positioning it for future growth opportunities.

VerticalScope Partners with TollBit to Monetize Community Content through AI Licensing

VerticalScope Holdings has partnered with TollBit to monetize its extensive collection of community-generated content by licensing it to AI companies. This collaboration aims to establish a scalable framework for content licensing, ensuring fair compensation and creating new revenue streams while protecting the integrity of its forums. The partnership is expected to enhance VerticalScope’s positioning in the AI-driven content discovery landscape, providing AI systems with access to high-quality, domain-specific knowledge that is crucial for training and development.