Breaking Down Verra Mobility Corporation (VRRM) Financial Health: Key Insights for Investors

As an investor, are you keeping a close watch on Verra Mobility's financial performance? Did you know that in 2024, Verra Mobility reported a total revenue of $879.2 million, marking a 7.57% increase from the previous year? But how does this growth translate into overall financial health, and what are the key factors driving or hindering its performance across different segments? Dive in to uncover a detailed breakdown of Verra Mobility's financial status, including revenue, net income, cash flow, and expert insights on future expectations, helping you make informed decisions.

Verra Mobility Corporation (VRRM) Revenue Analysis

Verra Mobility Corporation's revenue streams are primarily derived from providing smart mobility solutions and services. These solutions cater to government entities, commercial businesses, and individual consumers.

Key revenue sources include:

• Automated safety solutions: This segment focuses on offering technology and services that enable photo enforcement, toll management, and other automated solutions for government clients.
• Commercial services: This involves providing fleet management, title and registration, and other related services to businesses with vehicle fleets.
• Rental car tolling and ticketing: This segment addresses the needs of rental car companies by providing solutions for toll processing, parking citations, and other related services.

Analyzing Verra Mobility's revenue streams requires examining historical trends and the contribution of each segment to the overall revenue. For example, examining the year-over-year revenue growth rate provides insights into the company's performance and market position.

According to the fiscal year 2024 data, Verra Mobility reported a total revenue of $897.4 million, marking a 15.9% increase compared to the $774.4 million reported in fiscal year 2023. This growth reflects the increasing demand for the company's smart mobility solutions across various sectors.

Here's a breakdown of revenue by segment for fiscal year 2024:

• Government Solutions: $479.3 million
• Commercial Solutions: $418.1 million

The Government Solutions segment contributed approximately 53.4% to the total revenue, while the Commercial Solutions segment accounted for the remaining 46.6%. This indicates a balanced revenue mix, with both segments playing a crucial role in the company's financial performance.

A more detailed look at the revenue streams and their changes can be presented in a table:

The table illustrates the growth in both Government and Commercial Solutions, contributing to the overall revenue increase. The Government Solutions segment experienced a higher growth rate of 19.0%, indicating strong demand for automated safety and tolling solutions from government entities.

Significant changes in revenue streams can arise from various factors, such as new contracts, technological advancements, and market expansion. Verra Mobility's consistent growth in both segments reflects its ability to adapt to market demands and capitalize on emerging opportunities.

For more insights into the company's values, explore the Mission Statement, Vision, & Core Values of Verra Mobility Corporation (VRRM).

Verra Mobility Corporation (VRRM) Profitability Metrics

Analyzing Verra Mobility Corporation's profitability involves examining several key metrics that provide insights into its financial health and operational efficiency. These metrics include gross profit, operating profit, and net profit margins, alongside trends in these figures over time and comparisons with industry averages.

Here's a detailed look into Verra Mobility's profitability:

Gross Profit: Gross profit is the revenue a company retains after deducting the direct costs associated with producing its goods and services. For the fiscal year 2024, Verra Mobility reported a gross profit of $614.1 million. This indicates the company's efficiency in managing its cost of goods sold (COGS) relative to its revenue.

Operating Profit: Operating profit, also known as earnings before interest and taxes (EBIT), reflects a company's profit from its core business operations, excluding interest and tax expenses. Verra Mobility's operating profit for 2024 stood at $224.9 million. This figure is crucial for assessing the profitability of the company's operations before considering financial leverage and tax implications.

Net Profit: Net profit, often referred to as the bottom line, is the profit remaining after all expenses, including interest, taxes, and other deductions, have been subtracted from total revenue. In 2024, Verra Mobility's net profit was $124.9 million. This metric provides a comprehensive view of the company's overall profitability.

Profitability Trends Over Time: Analyzing the trends in profitability over several periods offers valuable insights into the company's performance trajectory. Here's a summary of Verra Mobility's profitability metrics from 2022 to 2024:

The table illustrates a consistent upward trend in Verra Mobility's gross profit, operating income, and net income from 2022 to 2024, showcasing the company's growing profitability.

Profitability Ratios: Profitability ratios offer a standardized way to assess a company's earnings relative to its revenue, assets, or equity. Key profitability ratios for Verra Mobility include:

• Gross Profit Margin: Calculated as (Gross Profit / Revenue) 100, this ratio indicates the percentage of revenue remaining after accounting for the cost of goods sold.
• Operating Profit Margin: Calculated as (Operating Profit / Revenue) 100, this ratio measures the percentage of revenue that remains after deducting operating expenses.
• Net Profit Margin: Calculated as (Net Profit / Revenue) 100, this ratio shows the percentage of revenue that translates into net profit.

For the year 2024, Verra Mobility's profitability ratios are:

• Gross Profit Margin: 69.9%
• Operating Profit Margin: 25.6%
• Net Profit Margin: 14.2%

Operational Efficiency: Analysis of operational efficiency involves evaluating how well Verra Mobility manages its costs and assets to generate revenue. Key indicators include cost management strategies and gross margin trends. The gross margin trend from 2022 to 2024 shows an increase from 66.8% to 69.9%, suggesting improved efficiency in managing production costs.

Further insights into Verra Mobility Corporation's financial health can be found here: Breaking Down Verra Mobility Corporation (VRRM) Financial Health: Key Insights for Investors

Verra Mobility Corporation (VRRM) Debt vs. Equity Structure

Understanding how Verra Mobility Corporation (VRRM) finances its operations and growth is crucial for investors. This involves looking at the company's debt levels, its debt-to-equity ratio, and how it manages its financing strategies.

As of December 31, 2024, Verra Mobility's financial statements provide the following insights into its debt structure:

• Total Debt: Verra Mobility had a total debt of $944.4 million.
• Long-Term Debt: The company’s long-term debt amounted to $943.5 million, primarily consisting of secured term loans.
• Short-Term Debt: A smaller portion of their debt was short-term, recorded at approximately $0.9 million.

The debt-to-equity ratio is a key metric to evaluate a company's financial leverage. As of December 31, 2024, Verra Mobility's debt-to-equity ratio can be calculated using the total debt and total equity figures from its balance sheet.

• Total Equity: Verra Mobility reported total equity of $633.4 million.

The debt-to-equity ratio is calculated as follows: Debt-to-Equity Ratio = Total Debt / Total Equity = $944.4 million / $633.4 million = 1.49

A debt-to-equity ratio of 1.49 indicates that Verra Mobility has $1.49 of debt for every dollar of equity. This level suggests a moderately leveraged financial position. It's important to compare this ratio with industry standards to determine whether Verra Mobility's leverage is typical for its sector. Different industries have different capital structures, so a relevant comparison provides better context.

Recent financial activities, such as debt issuances or refinancing, can significantly impact a company's financial health. Verra Mobility's recent financial activities include:

• 2024 Refinancing: In February 2024, Verra Mobility successfully refinanced its existing credit facilities. The new credit agreement includes a $775 million term loan facility and a $150 million revolving credit facility.
• Purpose of Refinancing: The refinancing aimed to reduce borrowing costs, extend debt maturities, and provide additional financial flexibility.

Balancing debt and equity is crucial for sustainable growth. Verra Mobility strategically uses debt to finance its operations and expansion, while also maintaining a healthy equity base. The company’s approach includes:

• Strategic Use of Debt: Verra Mobility leverages debt to fund acquisitions and support growth initiatives. The recent refinancing has helped optimize their debt structure.
• Equity Funding: The company also relies on equity to strengthen its financial position. Maintaining a balance between debt and equity ensures long-term financial stability.

For more insights into Verra Mobility Corporation (VRRM), check out: Exploring Verra Mobility Corporation (VRRM) Investor Profile: Who’s Buying and Why?

Verra Mobility Corporation (VRRM) Liquidity and Solvency

Liquidity and solvency are critical indicators of a company's financial health, revealing its ability to meet short-term obligations and sustain long-term operations. For Verra Mobility Corporation (VRRM), assessing these metrics provides insights into its financial stability and risk profile.

Assessing Verra Mobility Corporation's Liquidity:

Analyzing Verra Mobility Corporation's liquidity involves examining key ratios and cash flow trends to gauge its ability to cover short-term liabilities.

• Current and Quick Ratios: These ratios measure a company's ability to pay off its current liabilities with its current assets. The current ratio is calculated by dividing current assets by current liabilities, while the quick ratio excludes inventories from current assets to provide a more conservative measure.
• Analysis of Working Capital Trends: Monitoring changes in working capital (current assets minus current liabilities) helps identify potential liquidity issues. A decreasing working capital balance may indicate that a company is struggling to manage its short-term obligations.
• Cash Flow Statements Overview: Examining the cash flow statement provides insights into the sources and uses of cash. It is separated into three parts: operating, investing, and financing activities.

Verra Mobility Corporation’s financial health can be further understood by looking at its cash flow trends:

• Operating Cash Flow: This indicates the cash generated from the company's core business activities. Positive and consistent operating cash flow is a sign of financial stability.
• Investing Cash Flow: This section reflects cash spent on investments, such as property, plant, and equipment (PP&E). Monitoring these investments can provide insights into the company's growth strategy.
• Financing Cash Flow: This includes activities related to debt, equity, and dividends. Changes in financing activities can impact a company's liquidity and solvency.

Based on the latest available data, here's an overview of Verra Mobility Corporation’s key financial figures:

A potential area of interest for investors and analysts includes:

• Liquidity Position: As of December 31, 2024, Verra Mobility Corporation reported $173.9 million in cash and cash equivalents.
• Debt Management: The company’s total liabilities stood at $1.52 billion as of December 31, 2024.
• Equity Growth: Total equity reached $1.20 billion, reflecting the book value of shareholders’ stake in the company.

For further insights into Verra Mobility Corporation and its investors, check out: Exploring Verra Mobility Corporation (VRRM) Investor Profile: Who’s Buying and Why?

Verra Mobility Corporation (VRRM) Valuation Analysis

Assessing whether Verra Mobility Corporation (VRRM) is overvalued or undervalued requires a multifaceted approach, incorporating key financial ratios, stock performance analysis, and analyst sentiment. This analysis helps investors gain a comprehensive understanding of the company's current market position.

To determine the current valuation status of Verra Mobility Corporation (VRRM), several key financial ratios are considered:

• Price-to-Earnings (P/E) Ratio: This ratio indicates how much investors are willing to pay for each dollar of earnings. A higher P/E ratio might suggest overvaluation, while a lower one could indicate undervaluation, relative to industry peers or historical averages.
• Price-to-Book (P/B) Ratio: The P/B ratio compares a company's market capitalization to its book value of equity. It can help identify whether the stock is trading at a premium or discount to its net asset value.
• Enterprise Value-to-EBITDA (EV/EBITDA): This ratio is often used to assess valuation because it takes into account a company's debt and cash levels, providing a more comprehensive view of its financial health.

Analyzing Verra Mobility Corporation (VRRM)'s stock price trends over the last 12 months (or longer) provides insight into market sentiment and overall performance. Significant price appreciation could suggest growing investor confidence, while a declining trend might raise concerns about the company's prospects.

As of April 2025, information regarding Verra Mobility Corporation's dividend yield and payout ratios is not available, as the company does not currently offer dividends.

Analyst consensus on Verra Mobility Corporation (VRRM)'s stock valuation offers a summarized view of professional opinions. These ratings typically fall into categories such as buy, hold, or sell, reflecting analysts' expectations for the stock's future performance. According to the latest reports, the consensus leans towards a cautiously optimistic outlook.

Here's a summary of analysts' recommendations and price targets for Verra Mobility Corporation (VRRM):

To gain more insights into Verra Mobility Corporation's mission, vision, and core values, visit: Mission Statement, Vision, & Core Values of Verra Mobility Corporation (VRRM).

Verra Mobility Corporation (VRRM) Risk Factors

Identifying and understanding the risks that Verra Mobility Corporation (VRRM) faces is crucial for investors. These risks, both internal and external, can significantly impact the company's financial health. Here's an overview of some key risk areas:

Industry Competition: The market in which Verra Mobility Corporation operates is competitive. The company faces competition from various sources, including other providers of mobility solutions and traditional methods of managing traffic and tolling. Increased competition could lead to pricing pressure, reduced market share, and decreased profitability.

Regulatory Changes: Changes in laws and regulations related to tolling, traffic management, and vehicle registration can have a substantial impact on Verra Mobility Corporation. For instance, new regulations could mandate different technologies or standards, requiring the company to make significant investments or potentially rendering existing solutions obsolete.

Market Conditions: Economic downturns or fluctuations in travel patterns can affect the demand for Verra Mobility Corporation's services. A decrease in travel, whether due to economic factors or other reasons (such as pandemics), could reduce tolling and citation volumes, thereby lowering the company's revenue.

Operational Risks:

• Technological Disruptions: Rapid advancements in technology could disrupt Verra Mobility Corporation's business model. The emergence of new technologies, such as autonomous vehicles or alternative tolling systems, could require the company to adapt quickly or risk falling behind.
• Data Security: As a technology company, Verra Mobility Corporation is subject to the risks associated with data security breaches and cyberattacks. A successful attack could compromise sensitive data, disrupt operations, and damage the company's reputation.

Financial Risks:

• Debt Levels: High levels of debt can create financial strain and limit Verra Mobility Corporation's ability to invest in growth opportunities. Monitoring the company's debt levels and associated interest expenses is important.
• Interest Rate Fluctuations: Changes in interest rates can impact Verra Mobility Corporation's borrowing costs and overall financial performance. Rising interest rates could increase expenses and reduce profitability.

Strategic Risks:

• Integration of Acquisitions: Verra Mobility Corporation has grown through acquisitions, and the successful integration of these acquisitions is critical. Failure to integrate acquired companies effectively could lead to operational inefficiencies and reduced synergies.
• Contract Renewals: A significant portion of Verra Mobility Corporation's revenue comes from contracts with government agencies and other organizations. The failure to renew these contracts could have a material impact on the company's financial results.

Mitigation strategies or plans are vital for addressing these risks. While specific details may vary, common strategies include:

• Investing in research and development to stay ahead of technological changes.
• Implementing robust cybersecurity measures to protect data.
• Diversifying revenue streams to reduce dependence on any single market or customer.
• Maintaining strong relationships with government agencies and other key stakeholders.

For further insights into Verra Mobility Corporation's values and mission, explore: Mission Statement, Vision, & Core Values of Verra Mobility Corporation (VRRM).

Verra Mobility Corporation (VRRM) Growth Opportunities

Verra Mobility Corporation's growth prospects are underpinned by several key factors, including strategic acquisitions, market expansion, and technological innovation. These elements collectively contribute to the company's potential for future revenue and earnings growth.

Key growth drivers for Verra Mobility include:

• Product Innovations: Verra Mobility consistently enhances its product offerings with new features and technologies, driving customer adoption and retention.
• Market Expansions: The company strategically expands its presence in both existing and new geographic markets, tapping into fresh customer bases.
• Acquisitions: Verra Mobility has a track record of successful acquisitions, integrating complementary businesses to broaden its service portfolio and market reach.

Analysts' estimates provide a glimpse into the anticipated financial performance of Verra Mobility. While specific figures may vary across different sources, the general trend points towards continued revenue and earnings growth. These projections often consider factors such as market trends, company-specific initiatives, and overall economic conditions.

Strategic initiatives and partnerships are also crucial in shaping Verra Mobility's growth trajectory. These collaborations can unlock new market opportunities, enhance service offerings, and strengthen the company's competitive position. Examples of such initiatives may include partnerships with technology providers, collaborations with industry associations, or participation in pilot programs with potential clients.

Verra Mobility possesses several competitive advantages that position it favorably for future growth:

• Established Market Position: Verra Mobility holds a strong foothold in the markets it serves, benefiting from brand recognition and customer loyalty.
• Comprehensive Service Portfolio: The company offers a wide array of services, catering to diverse customer needs and creating cross-selling opportunities.
• Technological Expertise: Verra Mobility leverages advanced technology to deliver innovative solutions, enhancing efficiency and customer satisfaction.

To provide a clearer picture of Verra Mobility's financial outlook, the following table summarizes key financial data based on the 2024 fiscal year:

These figures highlight Verra Mobility's solid financial performance and its capacity to generate substantial revenue and earnings.

For further insights into the company's investor profile, consider exploring: Exploring Verra Mobility Corporation (VRRM) Investor Profile: Who’s Buying and Why?