Company: i3 Verticals, Inc.
Symbol: IIIV
Description: They deliver seamless integrated payment and software solutions to small- and medium-sized businesses and organizations in strategic vertical markets.
Trade Date: 6/21
Shares: 6.65 million
Price Range: $11.00-$13.00
Underwriter(s): Cowen, Raymond James, KeyBanc Capital Markets
Terms Added: 6-11-18
Business: They have built a broad suite of payment and software solutions that address the specific needs of SMBs and other organizations in their strategic vertical markets, and they believe their suite of solutions differentiates them from their competition. Their primary strategic vertical markets include education, non-profit, public sector, property management and healthcare. These vertical markets are large, growing and tend to have increasing levels of electronic payments adoption compared to other industries. In addition to their strategic vertical markets, they also have a growing presence in the business-to-business (“B2B”) payments market. The B2B payments market is significantly less penetrated by electronic payments. According to PayStream Advisors’ 2017 Electronic Payments Report, checks account for more than 45% of B2B payments, presenting an opportunity for further adoption of card-based and other electronic payments. They processed approximately $10.3 billion in total payment volume in 2017, growing at a compound annual growth rate (“CAGR”) of 67% since 2014.
Financials: For the six month period ended March 31, 2018, they generated $154.9 million in revenue, $(7.2) million of net loss and $14.6 million of adjusted EBITDA, compared to $124.5 million in revenue, $(0.4) million of net loss and $9.1 million of adjusted EBITDA for the comparable period in 2017, an increase of 24% and 60% for revenue and adjusted EBITDA, respectively. In fiscal year 2017, they generated $262.6 million in revenue, $0.9 million of net income and $19.3 million of adjusted EBITDA, compared to $199.6 million in revenue, $(2.1) million of net loss and $17.6 million of adjusted EBITDA in fiscal year 2016, an increase of 32% and 10% for revenue and adjusted EBITDA, respectively.
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