Thursday, February 13, 2025
Patrick McCann, CFA, Research Analyst, Noble Capital Markets, Inc.
Michael Kupinski, Director of Research, Equity Research Analyst, Digital, Media & Technology , Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Q4 results in line. The company reported Q4 revenue of $800 million, largely in line with our estimate of $808 million. Adj. EBITDA in the quarter was $32 million, better than our estimate of $27 million. Notably, adj. revenue (ex-divestitures) improved sequentially, as the company continued to sign new business, which resulted in new business annual contract value in Q4 exceeding Q3.
Commercial segment momentum. Although Commercial segment adj. revenue was down 3.7% in Q4, management noted that the gap is narrowing between lost and expiring business and new business signings. Importantly, the segment, which is the largest by revenue, is expected to swing towards positive revenue growth near the end of 2025.
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