Vertex Profitability Analysis

VERX Stock  USD 54.64  0.39  0.72%   
Based on the key profitability measurements obtained from Vertex's financial statements, Vertex may not be well positioned to generate adequate gross income at the present time. It has a very high chance of underperforming in January. Profitability indicators assess Vertex's ability to earn profits and add value for shareholders.
 
Net Loss  
First Reported
2019-03-31
Previous Quarter
5.2 M
Current Value
7.2 M
Quarterly Volatility
11 M
 
Covid
Operating Cash Flow Sales Ratio is likely to rise to 0.23 in 2024, whereas Price To Sales Ratio is likely to drop 5.54 in 2024. Net Income Per E B T is likely to rise to 0.92 in 2024, despite the fact that Accumulated Other Comprehensive Income is likely to grow to (20.7 M).
Current ValueLast YearChange From Last Year 10 Year Trend
Gross Profit Margin0.680.609
Moderately Up
Slightly volatile
For Vertex profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Vertex to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Vertex utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Vertex's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Vertex over time as well as its relative position and ranking within its peers.
  

Vertex's Revenue Breakdown by Earning Segment

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For more information on how to buy Vertex Stock please use our How to Invest in Vertex guide.
Is Application Software space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Vertex. If investors know Vertex will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Vertex listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.96)
Earnings Share
0.19
Revenue Per Share
4.162
Quarterly Revenue Growth
0.175
Return On Assets
0.0112
The market value of Vertex is measured differently than its book value, which is the value of Vertex that is recorded on the company's balance sheet. Investors also form their own opinion of Vertex's value that differs from its market value or its book value, called intrinsic value, which is Vertex's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Vertex's market value can be influenced by many factors that don't directly affect Vertex's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Vertex's value and its price as these two are different measures arrived at by different means. Investors typically determine if Vertex is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Vertex's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Vertex Return On Asset vs. Return On Equity Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Vertex's current stock value. Our valuation model uses many indicators to compare Vertex value to that of its competitors to determine the firm's financial worth.
Vertex is rated first in return on equity category among its peers. It is rated below average in return on asset category among its peers reporting about  0.09  of Return On Asset per Return On Equity. The ratio of Return On Equity to Return On Asset for Vertex is roughly  11.33 . At this time, Vertex's Return On Equity is fairly stable compared to the past year. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Vertex's earnings, one of the primary drivers of an investment's value.

Vertex Return On Asset vs. Return On Equity

Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.

Vertex

Return On Equity

 = 

Net Income

Total Equity

 = 
0.13
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Return on Asset or ROA shows how effective is the management of the company in generating income from utilizing all of the assets at their disposal. It is a useful ratio to evaluate the performance of different departments of a company as well as to understand management performance over time.

Vertex

Return On Asset

 = 

Net Income

Total Assets

 = 
0.0112
Return on Asset measures overall efficiency of a company in generating profits from its total assets. It is expressed as the percentage of profits earned per dollar of Asset. A low ROA typically means that a company is asset-intensive and therefore will needs more money to continue generating revenue in the future.

Vertex Return On Asset Comparison

Vertex is currently under evaluation in return on asset category among its peers.

Vertex Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Vertex, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Vertex will eventually generate negative long term returns. The profitability progress is the general direction of Vertex's change in net profit over the period of time. It can combine multiple indicators of Vertex, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for Next Year
Accumulated Other Comprehensive Income-21.7 M-20.7 M
Net Interest Income-1.1 M-1.2 M
Interest Income969.5 K899.1 K
Operating Income-7.4 M-7.8 M
Net Loss-33.7 M-32 M
Income Before Tax-21.7 M-22.8 M
Total Other Income Expense Net-14.3 M-15 M
Net Loss-11.1 M-11.6 M
Net Loss-13.1 M-13.7 M
Income Tax Expense-8.6 M-8.2 M
Non Operating Income Net Other-1.1 M-1.2 M
Change To Netincome9.2 M8.8 M
Net Loss(0.09)(0.09)
Income Quality(5.68)(5.96)
Net Income Per E B T 0.60  0.92 

Vertex Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Vertex. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Vertex position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Vertex's important profitability drivers and their relationship over time.

Vertex Profitability Trends

Vertex profitability trend refers to the progression of profit or loss within a business. An upward trend means that Vertex's profit has generally increased over time, and a downward profitability trend means profits are declining. Recognizing problems early in profitability trends allows investors to address revenue and cost issues in advance. Investors and analysts usually monitor three types of profitability trends: gross, operating, and net. Gross profit is the difference between revenue and costs of goods sold. Operating profit is Vertex's gross profit minus its overhead. After you account for other unusual revenue, expenses, and costs, you get net profit. Gross profit trends are often a good indicator of future profitability. If you have high gross profit margins, you have a better chance to cover overhead and make money.

Vertex Profitability Drivers Correlations

One of the toughest challenges investors face today is learning how to quickly synthesize and read into endless financial statements and information provided by the company, SEC reporting, and various external parties. Understanding the correlation between Vertex different financial indicators related to revenue and profit generation helps investors identify and prioritize their investing strategies towards Vertex in a much-optimized way. Analyzing correlations between profit drivers that are directly associated with dollar figures is the most effective way to break down Vertex's future profitability.

Use Vertex in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Vertex position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Vertex will appreciate offsetting losses from the drop in the long position's value.

Vertex Pair Trading

Vertex Pair Trading Analysis

The ability to find closely correlated positions to Vertex could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Vertex when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Vertex - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Vertex to buy it.
The correlation of Vertex is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Vertex moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Vertex moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Vertex can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

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Additional Tools for Vertex Stock Analysis

When running Vertex's price analysis, check to measure Vertex's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Vertex is operating at the current time. Most of Vertex's value examination focuses on studying past and present price action to predict the probability of Vertex's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Vertex's price. Additionally, you may evaluate how the addition of Vertex to your portfolios can decrease your overall portfolio volatility.