I3 Verticals, Inc.

IIIV

Services-Business Services, NEC

Mkt Cap

$458.6M

PE

-172.92

Debt

$385.1M

Cash

$12.4M

EV

$831.3M

FCF

$30.3M

Market Cap

$458.6M

P/E Ratio

-172.92

Debt

$385.1M

Cash

$12.4M

EV

$831.3M

FCF

$30.3M

i3 Verticals, Inc. provides integrated payment and software solutions to small- and medium-sized businesses and organizations in education, non-profit, public sector, and healthcare markets in the United States. It operates in two segments, Merchant Services, and Proprietary Software and Payments. The company offers payment processing services that enables clients to accept electronic payments, facilitating the exchange of funds and transaction data between clients, financial institutions, and payment networks. The company also licenses software; and provides ongoing support, and other point of sale-related solutions. It offers its solutions to clients through direct sales force; distribution partners, including independent software vendors, value-added resellers, and independent sales organizations; and referral partners, such as financial institutions, trade associations, chambers of commerce, and card issuers. The company was founded in 2012 and is headquartered in Nashville, Tennessee.

Sector

10-K
9/30/23
10-Q
6/30/23
10-Q
3/31/23
10-Q
12/31/22
10-K
9/30/22
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6/30/22
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3/31/22
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12/31/21
10-K
9/30/21
10-Q
6/30/21
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3/31/21
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12/31/20
10-K
9/30/20
10-Q
6/30/20
10-Q
3/31/20
10-Q
12/31/19
10-K
9/30/19
10-Q
6/30/19
10-Q
3/31/19
10-Q
12/31/18
10-K
9/30/18
10-Q
6/30/18

DCF

Discounted Cash Flow Valuation of I3 Verticals, Inc.

Calculate

Growth Years

Growth

Start

End

Discount

Start

End

Multiple

g\r	+10%	+11%	+12%	+13%	+14%
0%	10	9	8	8	7
+1%	11	10	9	8	8
+2%	13	11	10	9	8
+3%	14	13	11	10	9
+4%	17	14	12	11	10

Years	0	1	2	3	4	5	6	7	8	9	10	TV
FCF	$30.3M	$39.06M	$49.32M	$60.96M	$73.73M	$87.21M	$100.8M	$113.9M	$125.7M	$135.3M	$142.1M	$1.421B
DCF		$33.97M	$37.29M	$40.08M	$42.16M	$43.36M	$43.6M	$42.83M	$41.09M	$38.46M	$35.12M	$351.2M
Value	$749.1M

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth -41%

Earnings Stability -31%

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

The Net Margin is too low to guarantee profitability in case of higher costs or higher interest rates. Furthermore lower margins cause higher earnings’ volatility.

Over time the ROA has been decreasing indicating a lower marginal ROA with respect to the calculated one, this could impede growth.

Years	09-2016	09-2017	09-2018	09-2019	09-2020	09-2021	09-2022	09-2023	TTM
Net Margin	-1%	0.34%	-2.1%	-0.81%	-0.65%	-3.5%	-7.3%	-0.72%	-0.72%
ROA	4%	5.4%	7.1%	1.8%	1.9%	-0.0018%	-0.32%	2.6%	2.6%
ROE	22%	2.5%	-6.1%	-2.1%	-0.41%	-2.7%	-7.5%	-0.81%	-0.81%

What is the average Net Margin?

The average Net Margin over the past 5 years is -2.52%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is -0.44%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +2.18%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is -0.88%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is -3.29%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is +0.23%.

Safety & Stabiliy

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

The company has high debt with respect to the cashflow it generates.

Data are missing

Years	09-2016	09-2017	09-2018	09-2019	09-2020	09-2021	09-2022	09-2023	TTM
Debt FCF	-	14.93	2.63	5.40	4.36	4.47	6.59	12.71	12.71
Debt Equity	-	3.18	0.37	0.98	0.38	0.69	0.93	1.17	1.17
MIN
Graham Stability	-	-	-	-	-	-	-	-	-

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 12.71.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is 1.54.

What is the Graham’s Stability?

Graham’s Stability measure stands at -.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Data are missing

Years	09-2016	09-2018	09-2020	09-2022	Trend
Revenue	9.2%	2.7%	35%	16%	0.9%
Net Income	-	-	-	-	-
Stockholders Equity	-	24%	11%	6.7%	-32%
FCF	19%	14%	13%	-30%	-7.5%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +2.74%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is +0.9%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is -17.4%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is -.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +23.95%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is -32.23%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is +13.82%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is -7.46%.