Should you sell your NowVertical stock?

Ventum Capital Markets analyst Robb Goff cut his target on NowVertical Group (NowVertical Group Stock Quote, Chart, News, Analysts, Financials TSXV:NOW) to C$0.50 from C$0.65 after the company’s fourth-quarter results, citing lower valuation multiples and a reduction in his 2026 EBITDA forecast, though he said the quarter itself was solid and he remains bullish on the longer-term setup.

Goff said the target cut reflects “tougher valuations” as well as a move to 2026 EBITDA of $6.0-million from $7.0-million, with the lower forecast partly meant to build in a modest buffer for foreign exchange volatility. He noted that Latin America accounted for about 68% of 2025 revenue, making currency an important variable. Even so, he said the revised target still leaves room for upside.

NowVertical reported fourth-quarter revenue of $9.7-million, largely in line with Goff’s $9.5-million estimate and consensus at $9.6-million, while Adjusted EBITDA of $1.8-million came in ahead of both his and consensus expectations of $1.5-million. Revenue rose 6.6% sequentially, while EBITDA was flat with the third quarter. Goff said the EBITDA beat was partly offset by a $0.9-million increase in compensation and benefits, mainly related to severance costs.

The analyst said he was encouraged by growth in core data analytics revenue, which reached $8.1-million, up $0.7-million, or 9.5%, from the prior quarter. The company’s overall 11% year-over-year revenue decline was driven mainly by lower subscription and maintenance reseller revenue in Brazil, prior-period revenue recognition and foreign exchange headwinds. Goff said the second half of 2025 was consistent with management’s earlier comments that momentum would improve through the back half of the year and into 2026.

For 2026, Goff lowered his revenue estimate to $39.4-million from $41.6-million, with the trim flowing through to gross profit and EBITDA forecasts of $19.7-million and $6.0-million. He said he was encouraged by the company’s concentration in larger strategic customers, noting revenue from the top 30 accounts rose about 14% in 2025 to $25.0-million and represented 67% of total revenue, up from 55% in 2024. He now expects those strategic accounts to grow about 20% to $30.0-million in 2026 and account for 76% of revenue.

Goff said he remains positive on management’s plan to deepen key partnerships, expand share of wallet with core clients and use its platform and offshoring capabilities to drive organic growth. He also described AI as a tailwind rather than a threat, saying NowVertical is building services around AI implementation and integration across enterprise accounts. He added that the company’s Google relationship, which generated $5.3-million in revenue year to date, up 36%, is helping support confidence in the financial trajectory.

With more than $10-million in available resources, including $8-million under its credit line, Goff said the company has flexibility to pursue organic growth and potentially tuck-in acquisitions. While investor confidence will likely depend on better execution in cross-selling, efficiency and M&A, he said the current enterprise value leaves meaningful upside if management delivers.

Goff said NowVertical should generate Adjusted EBITDA of $6.0-million on revenue of $39.4-million in fiscal 2026, improving to Adjusted EBITDA of $7.5-million on revenue of $43.0-million in fiscal 2027.

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