Vertex Inc. (VERX) PT Lowered to $25 at Stifel

Stifel analyst Brad Reback lowered the price target on Vertex Inc. (NASDAQ: VERX) to $25.00 (from $31.00) while maintaining a Hold rating.

The analyst commented, "Vertex shares traded off ~20% today as 2Q results just hit expectations and, more importantly, management lowered its FY25 guidance amid broad macro softness (true-ups and entitlement growth...~ $10M headwind) and delayed ERP migration activity. The net result is that NRR slipped to 108% (from 109% in 1Q and 110% in 2Q24), and the company is now modeling 2H subscription growth in the ~12% range.Management remains confident in its ability to re-accelerate growth in coming quarters/years driven by normalized NRR growth, uptake of its recently released eInovicing product, and a pick-up in ERP upgrade activity, especially within the SAP base, as we note recent ERP results from ORCL/MSFT have been fairly robust.That said, management is pulling back on headcount growth and leveraging internal tech investments to protect margins, which is absolutely the right move, but leads us to believe we should not expect a quick rebound in growth rates."

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