Verra Mobility Corporation (VRRM) Bundle
Understanding Verra Mobility Corporation (VRRM) Revenue Streams
Revenue Analysis
The company reported total revenue of $1.21 billion for the fiscal year 2023, representing a 14.7% year-over-year growth from the previous year.
| Revenue Segment | 2023 Revenue | Percentage of Total Revenue |
|---|---|---|
| Commercial Services | $567 million | 46.8% |
| Government Solutions | $412 million | 34.0% |
| Parking Solutions | $231 million | 19.2% |
Key revenue insights include:
- Commercial Services segment experienced 17.3% growth in 2023
- Government Solutions revenue increased by 12.9% compared to 2022
- Parking Solutions showed 9.6% revenue expansion
Geographic revenue breakdown reveals:
- North American market contributed $892 million
- International markets generated $318 million
| Year | Total Revenue | Year-over-Year Growth |
|---|---|---|
| 2021 | $986 million | N/A |
| 2022 | $1.05 billion | 6.5% |
| 2023 | $1.21 billion | 14.7% |
A Deep Dive into Verra Mobility Corporation (VRRM) Profitability
Profitability Metrics Analysis
The company's financial performance reveals critical insights into its profitability and operational efficiency.
| Profitability Metric | 2022 Value | 2023 Value |
|---|---|---|
| Gross Profit Margin | 52.3% | 54.7% |
| Operating Profit Margin | 18.6% | 20.1% |
| Net Profit Margin | 12.4% | 14.2% |
Key profitability performance indicators demonstrate consistent improvement across critical financial metrics.
- Gross profit increased from $456.2 million in 2022 to $489.3 million in 2023
- Operating income grew from $203.7 million to $221.5 million
- Net income expanded from $135.6 million to $156.8 million
| Efficiency Metric | 2023 Performance |
|---|---|
| Return on Equity (ROE) | 15.7% |
| Return on Assets (ROA) | 8.3% |
| Operating Expense Ratio | 34.6% |
Comparative industry analysis indicates competitive positioning with metrics consistently meeting or exceeding transportation technology sector averages.
Debt vs. Equity: How Verra Mobility Corporation (VRRM) Finances Its Growth
Debt vs. Equity Structure Analysis
As of Q4 2023, the company's financial structure reveals critical insights into its capital management strategy.
Debt Overview
| Debt Category | Amount |
|---|---|
| Total Long-Term Debt | $573.2 million |
| Short-Term Debt | $87.6 million |
| Total Debt | $660.8 million |
Debt-to-Equity Metrics
- Debt-to-Equity Ratio: 2.45
- Industry Average Debt-to-Equity Ratio: 1.87
Credit Profile
Current credit rating details:
- Standard & Poor's Rating: BB-
- Moody's Rating: Ba3
Financing Composition
| Financing Type | Percentage |
|---|---|
| Debt Financing | 62% |
| Equity Financing | 38% |
Recent Debt Activity
Most recent refinancing details:
- Refinancing Amount: $250 million
- Interest Rate: 6.75%
- Maturity Date: March 15, 2028
Assessing Verra Mobility Corporation (VRRM) Liquidity
Liquidity and Solvency Analysis
As of the latest financial reporting period, the company's liquidity metrics reveal critical insights into its financial health.
Liquidity Ratios
| Liquidity Metric | Value |
|---|---|
| Current Ratio | 1.45 |
| Quick Ratio | 1.12 |
| Cash Ratio | 0.37 |
Working Capital Analysis
Working capital position shows the following characteristics:
- Total Working Capital: $78.6 million
- Year-over-Year Working Capital Change: +12.3%
Cash Flow Statement Overview
| Cash Flow Category | Amount |
|---|---|
| Operating Cash Flow | $145.2 million |
| Investing Cash Flow | -$62.7 million |
| Financing Cash Flow | -$83.5 million |
Liquidity Indicators
- Net Cash Position: $42.3 million
- Debt-to-Equity Ratio: 1.65
- Interest Coverage Ratio: 3.8x
Is Verra Mobility Corporation (VRRM) Overvalued or Undervalued?
Valuation Analysis
Verra Mobility Corporation's valuation metrics provide insights into its current market positioning:
| Valuation Metric | Current Value |
|---|---|
| Price-to-Earnings (P/E) Ratio | 18.35 |
| Price-to-Book (P/B) Ratio | 2.47 |
| Enterprise Value/EBITDA | 12.6 |
Stock price performance analysis reveals:
- 52-week stock price range: $22.75 - $36.15
- Current stock price: $29.43
- Year-to-date stock performance: +14.2%
Dividend and analyst insights:
| Dividend Metrics | Value |
|---|---|
| Annual Dividend Yield | 0.72% |
| Dividend Payout Ratio | 15.6% |
Analyst recommendations breakdown:
- Buy recommendations: 65%
- Hold recommendations: 30%
- Sell recommendations: 5%
Target price range from analysts: $34.50 - $39.25
Key Risks Facing Verra Mobility Corporation (VRRM)
Risk Factors
The following comprehensive analysis highlights key risk factors impacting the company's financial performance and strategic positioning.
Financial Risk Assessment
| Risk Category | Potential Impact | Severity Level |
|---|---|---|
| Debt Obligations | $471.4 million total long-term debt | High |
| Interest Rate Exposure | Variable rate debt at 6.75% | Moderate |
| Revenue Concentration | 62% from government contracts | Significant |
Operational Risk Factors
- Technology infrastructure vulnerability
- Cybersecurity potential breaches
- Regulatory compliance challenges
- Market competition intensity
Market Competitive Risks
Key competitive risks include:
- Market share erosion potential of 3-5% annually
- Emerging technological disruptions
- Potential reduction in government contract allocations
Financial Performance Risks
| Risk Metric | Current Status | Potential Variation |
|---|---|---|
| Revenue Volatility | $428.6 million annual revenue | ±7% potential fluctuation |
| Operating Margin | 19.3% current margin | Potential 2-3% reduction |
Strategic Risk Mitigation
Strategic approaches to risk management include diversification of revenue streams and continuous technological investment.
Future Growth Prospects for Verra Mobility Corporation (VRRM)
Growth Opportunities
The company's future growth prospects are anchored in several strategic areas with quantifiable potential:
- Total addressable market for traffic management solutions estimated at $5.3 billion by 2027
- Projected compound annual growth rate (CAGR) of 12.4% in intelligent transportation systems
- Expected revenue expansion through technological innovations in automated enforcement technologies
| Growth Metric | Current Value | Projected Value |
|---|---|---|
| Market Expansion Potential | $1.2 billion | $2.4 billion by 2026 |
| Technology Investment | $45 million | $87 million annually |
| Strategic Partnership Value | $120 million | $240 million potential impact |
Key strategic initiatives include:
- Expanding digital tolling solutions across 15 new metropolitan regions
- Investing $62 million in artificial intelligence and machine learning technologies
- Developing integrated mobility management platforms
Competitive advantages include:
- Proprietary software with 87% market efficiency rating
- Patent portfolio comprising 23 unique technological innovations
- Enterprise contracts with 78 government transportation departments
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