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Investing.com - Raymond (NSE:RYMD) James has raised its price target on i3 Verticals (NASDAQ:IIIV) to $39.00 from $33.00 while maintaining a Strong Buy rating following the company’s fiscal third-quarter 2025 results. The stock, currently trading at $32, is near its 52-week high, with InvestingPro data showing the company’s Fair Value is closely aligned with its current market price.
The company reported approximately 2% revenue upside and 4% adjusted EBITDA beat compared to Street expectations. With an impressive gross profit margin of 90.72% and revenue growth of 9.06% over the last twelve months, i3 Verticals continues to show strong fundamentals. Organic growth remained in the high single digits at 8% for the fiscal third quarter, while annual recurring revenue (ARR) accelerated 300 basis points to 12%.
Despite maintaining its full-year revenue guidance, which implies fiscal fourth-quarter organic growth will decrease to approximately 3%, management explained this is due to tougher nonrecurring comparisons of about 400 basis points. ARR growth is expected to continue at double-digit rates.
While not providing formal fiscal year 2026 guidance, the company indicated it expects to maintain high single-digit normalized organic growth with 50-100 basis points of EBITDA margin expansion. The merger and acquisition pipeline remains robust, with Raymond James estimating the company has approximately $350 million of capacity for deals. For deeper insights into i3 Verticals’ financial health and growth prospects, check out the comprehensive Pro Research Report available on InvestingPro.
The investment firm views i3 Verticals as a pure-play public sector software business with a compelling growth strategy that will be supplemented by strategic acquisitions, noting the stock trades at approximately 14 times Raymond James’ 2027 estimated EBITDA. The company maintains a healthy balance sheet with a current ratio of 2.02, indicating strong liquidity to support its growth initiatives.
In other recent news, i3 Verticals Inc. reported its financial results for the third quarter of fiscal year 2025, exceeding analyst expectations. The company announced an adjusted diluted earnings per share (EPS) of $0.23, surpassing the projected $0.21. Additionally, i3 Verticals achieved a revenue of $51.9 million, which was above the expected $49.89 million. These results reflect a 9.52% earnings surprise and a 4.03% revenue beat. The announcement of these financial achievements was well-received. In related developments, there was no mention of mergers or acquisitions. Analysts have not provided any recent upgrades or downgrades for i3 Verticals. Further company news was not highlighted in the recent updates.
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