Vertex (NASDAQ:VERX) Stock Price Down 6.1% - Should You Sell?

Vertex, Inc. (NASDAQ:VERX) saw its shares drop by 6.1% on Friday. The stock traded as low as $32.10, eventually closing at $31.99. During the trading session, 281,648 shares changed hands, which is a significant decline of 69% compared to the average volume of 906,744 shares. Previously, the stock had closed at $34.06.

Wall Street Analysts Forecast Growth

Vertex has been a subject of interest among several research analysts. Recently, The Goldman Sachs Group revised down its price target on Vertex shares from $64.00 to $48.00, maintaining a "buy" rating for the stock. On the other hand, Morgan Stanley increased its price target from $50.00 to $62.00 and assigned an "overweight" rating. Meanwhile, BMO Capital Markets raised its target from $42.00 to $52.00, giving it a "market perform" rating.

Citigroup has also adjusted its price objective, increasing it from $46.00 to $54.00, while Stifel Nicolaus downgraded Vertex from a "buy" to a "hold," slashing its target from $58.00 to $31.00. Currently, five equity research analysts rate the stock as a hold, seven as a buy, and one gives it a strong buy. According to MarketBeat data, Vertex has an average rating of "Moderate Buy" with a consensus target price of $50.00.

Vertex Financial Metrics and Recent Earnings

Vertex has a market capitalization of $5.06 billion and a price-to-earnings ratio of 180.51. Its price-to-earnings growth (P/E/G) ratio stands at 6.66, along with a beta of 0.87. The company's current and quick ratios are both at 1.04, while its debt-to-equity ratio is 1.29. The 50-day moving average price is $50.44, and the 200-day moving average is $46.63.

On February 27, Vertex reported its latest earnings, showing a profit of $0.10 per share. This figure fell short of analysts' expectations, who had predicted earnings of $0.13 per share. The company’s net margin is 4.73%, and it boasts a return on equity of 24.92%. Revenue for the quarter was reported at $178.46 million, exceeding the consensus estimate of $176.90 million. Analysts forecast Vertex to report earnings of $0.38 per share for the current fiscal year.

Insider Transactions at Vertex

In notable insider trading news, Jeffrey Westphal sold 575,000 shares of Vertex on December 12 at an average price of $53.01, resulting in a total transaction value of approximately $30.48 million. After this sale, Westphal’s direct ownership of the stock decreased by 98.65%, leaving him with 7,895 shares valued at around $418,514. Another major insider, Item Second Irr. Trust Fbo Kyl, sold 53,843 shares on January 22 at an average price of $56.48, totaling approximately $3.04 million, which was a decrease of 4.20% in ownership. Recent months have seen insiders sell a total of 858,457 shares worth about $46.16 million. Currently, insiders own 44.58% of the stock.

Institutional Investor Activity

Several institutional investors and hedge funds have adjusted their positions in Vertex recently. For instance, Fairman Group LLC acquired a new stake valued at around $327,000. Meanwhile, Empowered Funds LLC took a new position worth approximately $3.36 million. Victory Capital Management increased its stake dramatically by 406.9%, now owning 34,386 shares worth about $1.32 million after a recent purchase. Additionally, DRW Securities LLC acquired a new stake, valued at $840,000, and Triasima Portfolio Management purchased shares worth about $3.14 million. Overall, institutional investors make up 70.32% of the company's stock ownership.

About Vertex, Inc.

Vertex, Inc. provides enterprise tax technology solutions for industries including retail, wholesale, and manufacturing, both domestically and internationally. The company specializes in tax determination, compliance and reporting, workflow management tools, role-based security, document management, analytics, and industry-specific technology solutions.

Final Thoughts for Investors

As Vertex trades down, potential investors may wonder whether this is a time to buy, hold, or sell. Analysts give a "Moderate Buy" rating, although several top research analysts have recommended other stocks as better investments currently. Understanding these dynamics is key when considering your investment strategy.

Vertex, Stock, Investment