Vertex drops on planned convertible debt offering

Vertex

23/04/2024 15:55

** Shares of tax software firm Vertex Inc  VERX.O  down 6.2%
at $28.18 on Tues as it looks to raise capital
    ** Co late Mon announced private offering of $250 mln 5-yr
convertible bonds
    ** It plans to use net proceeds to fund capped call
transactions, rest for working capital/general purposes,
including capex, potential acquisitions, strategic transactions
    ** Co also released preliminary Q1 results: forecasts of
155.5-$157.5 mln in rev and $35.5-$37.5 mln in adj EBITDA both
topped consensus estimates of $154.5 mln/$30.13 mln, LSEG data
showed
    ** VERX has roughly $4.4 bln market cap
    ** Citigroup, which rates VERX "neutral", trimmed its PT by
$2 to $32
    ** Valuation is "main concern", Citigroup says in note, and
points to questions on European e-invoicing
    ** With move on the session, VERX shares up 4% YTD and up
about 30% over the past 12 months
    ** Nearly 1.2 mln shares have traded so far on Tues, 3.4x
stock's 10-DMA volume - LSEG
    ** In Jan, Vertex was outbid by Thomson Reuters  TRI.TO ,
which bought Swedish e-invoicing and tax solutions co Pagero for
about $789 mln

 (Lance Tupper is a Reuters market analyst. The views expressed
are his own)
 ((lance.tupper@thomsonreuters.com
lance.tupper@tr.com 1-646-279-6380))