VerticalScope Holdings (FORA) AI Stock Analysis

• Market Cap: C$69.19M
• Dividend Yield: N/A
• Average Volume (3M): 71.49K
• Price to Earnings (P/E): 62.5
• Beta (1Y): 0.59
• Revenue Growth: 4.33%
• EPS Growth: -467.88%
• Country: CA
• Employees: 191
• Sector: Communication Services
• Sector Strength: 96
• Industry: Internet Content & Information
• EPS (TTM): -0.11
• Shares Outstanding: 18,529,820
• 10 Day Avg. Volume: 41,321
• 30 Day Avg. Volume: 71,492
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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$5.42
• Price Target Upside: 68.85% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 43 Neutral
• Price Target: C$3.00 ▼(-6.54% Downside)

VerticalScope Holdings' overall stock score is primarily impacted by its mixed financial performance and bearish technical indicators. The company's strong gross profit margins and cash flow are overshadowed by declining revenue growth and negative net profitability. The technical analysis indicates a strong bearish trend, further weighing down the score. The negative P/E ratio and lack of dividend yield contribute to a poor valuation score, reinforcing the overall low score.

Positive Factors

Audience Engagement

Direct traffic is gaining momentum, supported by FORA’s 50M registered users who are more engaged and generate greater lifetime value.

E-commerce Growth

E-commerce revenue jumped 41%, driven mainly by acquisition of Ritual, and management expects further double-digit growth.

New Revenue Models

Emerging tools can detect, block, and monetize AI bot traffic, potentially unlocking a new revenue model for FORA.

Negative Factors

Algorithm Changes Impact

FORA sharply lowered its outlook for F2025 following the core Google algorithm change in March.

Audience Size Pressure

Google’s March algorithm changes resulted in pressure on their audience size, with MAUs declining 25.7% y/y to 90.5M.

Top-line Decline

The 13% y/y top-line decline was driven mainly by lower MAUs compared to a record-high base in the prior year.

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 Holdings generates revenue primarily through digital advertising and subscription services. The company monetizes its extensive network of online communities by offering targeted advertising solutions to businesses aiming to reach specific audience segments. Additionally, VerticalScope offers premium membership options for users seeking enhanced features and an ad-free experience on their platforms. The company's revenue model is further supported by strategic partnerships with advertisers and technology providers, enhancing its ability to deliver personalized and effective marketing solutions.

VerticalScope Holdings Financial Statement Overview

Summary

VerticalScope Holdings shows a mixed financial performance. The company has strong gross profit margins and positive cash flow generation, but faces challenges with declining revenue growth and negative net profitability. The balance sheet indicates moderate leverage, but the negative return on equity suggests issues 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	65.75M	69.05M	60.90M	80.49M	65.76M	56.92M
Gross Profit	51.41M	40.96M	34.22M	45.67M	38.95M	35.46M
EBITDA	17.72M	23.68M	18.55M	14.71M	440.34K	8.54M
Net Income	-3.66M	-15.86K	-4.95M	-24.77M	-12.26M	-1.51M
Balance Sheet
Total Assets	134.14M	132.41M	152.95M	177.56M	217.03M	87.68M
Cash, Cash Equivalents and Short-Term Investments	8.14M	5.19M	6.02M	8.77M	20.49M	4.60M
Total Debt	46.27M	40.82M	61.52M	61.64M	84.06M	104.70M
Total Liabilities	56.49M	49.72M	72.27M	96.06M	120.79M	110.23M
Stockholders Equity	77.64M	82.69M	80.69M	81.50M	96.24M	-22.54M
Cash Flow
Free Cash Flow	14.99M	22.61M	13.25M	10.92M	-4.09M	9.39M
Operating Cash Flow	22.28M	24.77M	15.51M	20.64M	19.60M	14.10M
Investing Cash Flow	-11.33M	-2.13M	-17.07M	-9.66M	-87.76M	-3.45M
Financing Cash Flow	-9.05M	-23.38M	-1.13M	-22.47M	84.40M	-11.19M

VerticalScope Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.21
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:FORA, the sentiment is Negative. The current price of 3.21 is below the 20-day moving average (MA) of 3.37, below the 50-day MA of 3.74, and below the 200-day MA of 7.36, indicating a bearish trend. The MACD of -0.15 indicates Negative momentum. The RSI at 32.74 is Neutral, neither overbought nor oversold. The STOCH value of 13.10 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:FORA.

VerticalScope Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	60 Neutral	$46.29B	4.07	-13.11%	4.12%	1.85%	-42.71%
FORA	43 Neutral	C$69.19M	62.54	-4.84%	―	4.33%	-467.88%
PNC.A	―	C$148.08M	―		―	―	―
EGLXF	―	$9.80M	―	-186.28%	―	―	―
ZMDTF	―	$153.70M	9.12	85.19%	―	―	―
OAM	56 Neutral	C$48.05M	450.00	-18.02%	―	46.80%	-82.67%
MIM	―	C$52.66M	―		―	―	―

VerticalScope Holdings Corporate Events

VerticalScope Reports Q2 2025 Financial Results, Focuses on AI and Long-term Growth

VerticalScope Holdings Inc. reported its second quarter 2025 financial results, highlighting a revenue of $14.5 million and a net loss of $1.8 million, attributed to a decline in monthly active users and increased investments in AI and traffic diversification. Despite these challenges, the company is focusing on long-term growth by enhancing user experience and monetizing its audience through AI-powered innovations. The company maintains a strong balance sheet with $64.1 million in available liquidity, supporting its strategic investments aimed at driving long-term value creation for shareholders.

VerticalScope to Release Q2 2025 Financial Results

VerticalScope Holdings Inc. announced that it will release its second quarter 2025 financial results on August 12, 2025, after market close. The company will host a conference call and webcast to discuss these results on August 13, 2025. This announcement is significant for stakeholders as it provides insights into the company’s financial health and operational performance, potentially impacting its market positioning and investor confidence.

VerticalScope Announces Shareholder Meeting Results

VerticalScope Holdings Inc. announced the results of its annual general meeting of shareholders, where all five nominees were elected as directors, and MNP LLP was reappointed as the company’s auditor. The voting results reflect strong shareholder support for the current leadership and operational strategies, which may positively impact the company’s stability and future growth.

VerticalScope Announces AGM Voting Results and Auditor Reappointment

VerticalScope Holdings Inc. announced the results of its annual general meeting of shareholders, where five directors were elected, and MNP LLP was reappointed as the company’s auditors. These decisions reflect the company’s ongoing commitment to maintaining strong governance and financial oversight, which are crucial for its continued growth and stability in the digital platform industry.

VerticalScope Announces Leadership Changes to Propel Growth

VerticalScope Holdings Inc., a technology company known for its cloud-based digital platform for online enthusiast communities, has announced a strategic leadership transition to drive its next phase of growth. Chris Goodridge has been appointed as the new CEO, succeeding founder Rob Laidlaw, who will remain as Chair of the Board. Ezra Menaged, previously CEO of Hometalk, has been promoted to COO. These appointments aim to strengthen VerticalScope’s leadership as generative AI reshapes content engagement, with a focus on accelerating AI adoption, expanding direct traffic, and diversifying revenue. The company is well-positioned with its rich user-generated content and aims to enhance its community-driven platforms.