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I3 Verticals
(NASDAQ:IIIV)
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Rating:66Neutral
Price Target:
$19.00
▲(16.14% Upside)
Action:Reiterated
Date:08/09/26
IIIV scores as moderately attractive primarily due to strong TTM cash flow quality, improved balance sheet leverage, and a high-recurring-revenue model with continued ARR/SaaS growth. The score is held back by weak price trend/momentum (trading below key moving averages with negative MACD), a not-cheap P/E without dividend support, and a cautious near-term outlook after FY2026 guidance was reduced and organic growth turned slightly negative.
Positive Factors
High-quality cash generation
TTM operating and free cash flow nearly match net income, signaling strong earnings-to-cash conversion. Durable cash generation supports reinvestment, M&A, and share repurchases, reduces refinancing risk and funds growth initiatives even if earnings ebb, improving long-term financial flexibility.
Negative Factors
Lowered FY2026 guidance and near-term headwinds
A material downward guidance revision reflects execution and market pressures that reduce visibility. Persisting shortfalls could force reliance on margin expansion or M&A to hit targets, challenging sustainable top-line momentum and testing management's ability to translate operational gains into durable growth.
Read all positive and negative factors
Positive Factors
Negative Factors
High-quality cash generation
TTM operating and free cash flow nearly match net income, signaling strong earnings-to-cash conversion. Durable cash generation supports reinvestment, M&A, and share repurchases, reduces refinancing risk and funds growth initiatives even if earnings ebb, improving long-term financial flexibility.
Read all positive factors
I3 Verticals Key Performance Indicators (KPIs)
Any
Revenue by Product
Breaks down revenue by product line—payment processing, software subscriptions, professional services, hardware, and related services—so you can see which offerings drive growth and cash flow. Reveals margin and risk differences (recurring software tends to be steadier and higher-margin than transaction-based payments), shows dependence on transaction volumes, and highlights where I3 Verticals can cross-sell or needs to diversify to sustain long-term profit growth.
Breaks down revenue by product line—payment processing, software subscriptions, professional services, hardware, and related services—so you can see which offerings drive growth and cash flow. Reveals margin and risk differences (recurring software tends to be steadier and higher-margin than transaction-based payments), shows dependence on transaction volumes, and highlights where I3 Verticals can cross-sell or needs to diversify to sustain long-term profit growth.
Data provided by:
The Fly
The FlyI3 Verticals (IIIV) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$436.95M
Dividend YieldN/A
Average Volume (3M)502.60K
Price to Earnings (P/E)40.7
Beta (1Y)0.55
Revenue Growth-8.15%
EPS Growth-91.81%
CountryUS
Employees1,202
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)0.41
Shares Outstanding18,019,749
10 Day Avg. Volume453,348
30 Day Avg. Volume502,604
Financial Highlights & Ratios
PEG Ratio-0.51
Price to Book (P/B)1.99
Price to Sales (P/S)3.64
P/FCF Ratio206.81
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$24.00Price Target Upside46.70% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)1.14
Revenue Forecast (FY)$223.67M
I3 Verticals Business Overview & Revenue Model
Company Description
i3 Verticals, Inc. (IIIV) delivers comprehensive payment and software solutions, catering to the operational needs of small and medium-sized businesses, as well as various organizations within the education, non-profit, public sector, and healthca...
How the Company Makes Money
I3 Verticals primarily makes money by enabling customers to accept electronic payments and by providing software and related services that are integrated into customer workflows. A major revenue stream comes from payment processing and related fee...
I3 Verticals Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Nov 25, 2026
Earnings Call Sentiment Neutral
The call presented a mixed picture: solid recurring revenue growth (ARR +8%), strong SaaS performance (+38%), improved adjusted EBITDA and EPS, and tangible AI-driven efficiency and public sector go-lives. However, these positives were offset by near-term execution challenges: lowered FY2026 guidance (down ~$6.5M), declines in non-recurring and professional services revenue (organic revenue -2%, non-recurring -18%), maintenance timing issues, payment interchange headwinds, and temporary weakness in the Resolve product. Management expects margin improvement and a recovery to mid-single-digit growth in 2027 driven by multiple go-lives and acquisitions, but the near-term outlook is cautious.Positive Updates
Modest Revenue Growth
Total revenue for Q3 FY2026 increased 2% year-over-year to $53.1M from $51.9M.
Negative Updates
Guidance Reduction and Revenue Headwinds
FY2026 revenue guidance was lowered by approximately $6.5M; updated guidance is $216M–$221M, with adjusted EBITDA $57M–$60M and adjusted diluted EPS $1.08–$1.12, materially below prior guidance.
Read all updates
Q3-2026 Updates
Positive
Negative
Modest Revenue Growth
Total revenue for Q3 FY2026 increased 2% year-over-year to $53.1M from $51.9M.
Read all positive updates
Company Guidance
The company updated FY2026 guidance to revenue of $216M–$221M, adjusted EBITDA of $57M–$60M and adjusted diluted EPS of $1.08–$1.12 (guidance lowered by ~$6.5M and excludes unannounced acquisitions/transaction costs); Q3 results included $53.1M revenue (organic down 2%), adjusted EBITDA $13.3M (25% of revenue, up from 24.5%), adjusted diluted EPS $0.25, ARR $174.1M (up 8% YoY), SaaS +38% and transaction-based +5%, with 82% of revenue recurring; balance sheet: $114.3M debt, $2.6M cash and $285.7M revolver capacity; the company now expects mid-single-digit revenue growth in FY2027 with margin expansion of roughly 100–200 basis points if that growth materializes.I3 Verticals Financial Statement Overview
Summary
Income Statement
68
Positive
Balance Sheet
76
Positive
Cash Flow
84
Very Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 218.16M | 213.16M | 229.92M | 189.68M | 187.75M | 224.12M |
| Gross Profit | 144.12M | 118.67M | 211.35M | 134.87M | 174.92M | 166.42M |
| EBITDA | 40.48M | 41.08M | 33.23M | 33.27M | 22.59M | 27.00M |
| Net Income | 10.70M | 17.87M | 113.34M | -811.00K | -17.10M | -4.46M |
Balance Sheet | ||||||
| Total Assets | 626.98M | 638.41M | 730.67M | 884.42M | 770.31M | 651.80M |
| Cash, Cash Equivalents and Short-Term Investments | 2.65M | 66.67M | 86.54M | 3.10M | 3.49M | 3.64M |
| Total Debt | 118.87M | 7.75M | 38.31M | 400.63M | 305.58M | 215.77M |
| Total Liabilities | 226.65M | 120.69M | 215.32M | 556.12M | 462.62M | 362.21M |
| Stockholders Equity | 280.55M | 389.58M | 379.74M | 236.75M | 218.38M | 204.76M |
Cash Flow | ||||||
| Free Cash Flow | 49.93M | 3.75M | 33.45M | 20.80M | 33.40M | 38.57M |
| Operating Cash Flow | 52.38M | 5.69M | 48.41M | 37.17M | 45.85M | 46.77M |
| Investing Cash Flow | -70.44M | 76.46M | 396.15M | -121.52M | -113.05M | -156.31M |
| Financing Cash Flow | -32.31M | -104.41M | -367.36M | 72.98M | 73.03M | 102.10M |
I3 Verticals Risk Analysis
I3 Verticals disclosed 50 risk factors in its most recent earnings report. I3 Verticals reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
I3 Verticals Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $1.79B | 40.98 | 19.61% | 0.98% | 12.20% | -13.97% | |
66 Neutral | $436.95M | 40.73 | 3.18% | ― | -8.15% | -91.81% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
58 Neutral | $644.35M | 27.77 | 27.89% | ― | -1.48% | 257.78% | |
51 Neutral | $741.41M | 36.09 | 12.33% | ― | 0.07% | -33.38% | |
39 Underperform | $438.37M | 23.14 | 11.58% | ― | -13.27% | -62.21% |
* Technology Sector Average
IIIV
I3 Verticals
16.60
-14.35
-46.37%
ATEN
A10 Networks
24.59
7.35
42.60%
RPD
Rapid7
11.00
-9.60
-46.60%
IMXI
International Money Express
14.51
0.07
0.48%
YEXT
Yext
6.51
-2.29
-26.02%
I3 Verticals Corporate Events
Business Operations and StrategyStock BuybackFinancial Disclosures
i3 Verticals Reports Q3 2026 Profitability Improvement
Positive
Aug 6, 2026
i3 Verticals, Inc., based in Nashville, Tenn., is a technology company that focuses on software and integrated payments solutions, with a strategic emphasis on recurring revenue from SaaS, transaction-based software, maintenance, and other softwar...
Business Operations and StrategyFinancial Disclosures
i3 Verticals Highlights GovTech Strategy in Investor Presentation
Positive
Jun 2, 2026
I3 Verticals has published an investor presentation on its website to support its participation in the Baird 2026 Global Consumer, Technology Services Conference on June 3, 2026, and the 2026 Davidson Technology Consumer Conference on June 11, 20...
Business Operations and StrategyStock Buyback
I3 Verticals Authorizes New $100 Million Share Repurchase
Positive
May 12, 2026
On May 12, 2026, I3 Verticals’ Board of Directors approved a new share repurchase program for the company’s Class A common stock, authorizing buybacks of up to $100 million and replacing the prior program adopted on February 5, 2026, w...
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.