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On Friday, RBC Capital Markets adjusted its outlook on EverCommerce Inc (NASDAQ: EVCM), reducing the price target to $11.00 from the previous $14.00, while continuing to recommend the stock as Outperform. The adjustment follows EverCommerce’s year-end financial performance, which surpassed both revenue and adjusted EBITDA expectations, as well as the high-end of the company’s own guidance. Currently trading at $9.51, the stock sits between analyst targets ranging from $8 to $15, with InvestingPro analysis indicating the stock is undervalued based on its Fair Value assessment.
The revised price target reflects the exclusion of MarTech contributions from the company’s CY/25 guidance, as EverCommerce plans to divest this segment in 2025. RBC Capital Markets noted that the updated guidance suggests an approximate 5% year-over-year revenue growth. Despite the complexity added by this divestiture, the firm views the company’s underlying business trends as stable to positive. The company maintains a strong financial position with a current ratio of 1.97, indicating liquid assets exceed short-term obligations, while generating $98.7 million in levered free cash flow over the last twelve months.
RBC Capital’s analyst expressed confidence in the foundational elements EverCommerce has established to achieve accelerated revenue growth and margin expansion in CY/25. The firm’s optimistic outlook is based on the company’s solid end-of-year results and strategic direction, despite the lowered price target due to revised estimates.
EverCommerce’s decision to sell its MarTech division is part of a strategic move to streamline its operations. The company’s performance and guidance indicate a focus on core business growth and profitability in the coming years.
Investors and stakeholders of EverCommerce Inc can now consider RBC Capital Markets’ updated assessment as they monitor the company’s progress toward its CY/25 financial goals and strategic initiatives.
In other recent news, EverCommerce Inc. reported mixed results for the fourth quarter of 2024. The company achieved revenue of $175 million, surpassing the forecasted $170.52 million, but reported a wider-than-expected loss per share of $0.07 compared to the anticipated $0.01. The company’s full-year 2024 pro forma revenue was $690.7 million, reflecting a 5.7% growth from the previous year. EverCommerce has set its guidance for Q1 2025, expecting revenue between $138 million and $141 million and adjusted EBITDA between $39 million and $41 million.
Additionally, Citizens JMP analyst Patrick Walravens maintained a Market Outperform rating for EverCommerce with a steady price target of $15.00. The analyst highlighted EverCommerce’s strategic simplification, including the planned divestment of its Marketing Technology segment, as a positive move expected to enhance financial performance. This divestment is anticipated to occur over the next 12 months. The company’s strategic focus remains on AI-driven workflows and product integrations, aiming to strengthen its core verticals and improve margins. These recent developments reflect EverCommerce’s efforts to streamline operations and focus on high-growth areas within its business.
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