Reassessing The Changing Outlook For Verra Mobility Corporation (VRRM)

The Vanguard Group, Inc. recently announced the acquisition of new stake in Verra Mobility Corporation (NASDAQ:VRRM). The institutional investor has increased its shareholding in the Industrials company by 14.33% to 16.38 million shares with purchase of 2.05 million shares. This fresh investment now brings its stake to 10.93% valued currently at $282.15 million. In addition, BlackRock Fund Advisors raised its holdings by 0.3 million to 8.56 million shares. And Wellington Management Co. LLP has lifted its position by 17.42% or 1.09 million shares – to 7.32 million shares.

With over 2.69 million Verra Mobility Corporation (VRRM) shares trading Friday and a closing price of $16.87 on the day, the dollar volume was approximately $45.46 million. The shares have shown a positive half year performance of 4.91% and its price on 03/10/23 lost nearly -2.88%. Currently, there are 149.19M common shares owned by the public and among those 148.40M shares have been available to trade.

An analysis of what Wall Street brokers have to say about the expected price targets for this stock gives us this picture: 7 analysts who have offered their price forecasts for VRRM have a consensus price objective of $20.17. The analysts have set the share’s price value over the next 12 months at a high of $25.00 and a low of $16.00. The average price target is 16.36% above its recent price level and a downside to the estimated low will see the stock lose -5.44% over that period. But an upside of 32.52% will see the stock hit the forecast high price target while median target price for the stock is $20.00.

Insiders at the company have transacted a total of 9 times over the past 12 months, according to data filed with the U.S. Securities and Exchange Commission (SEC). 7 of these insider trades were purchases, accounting for 343,700 shares. Insider sales of the common stock occurred on 2 occasions, with total insider shares sold totaling 132,191 shares.

The top 3 mutual fund holders in Verra Mobility Corporation are iShares Core S&P Small Cap ETF, Mackenzie US Mid Cap Growth Class, and Vanguard Total Stock Market Index. iShares Core S&P Small Cap ETF owns 10.56 million shares of the company’s stock, all valued at over $181.97 million. The company bought an additional 22802.0 shares recently to bring their total holdings to about 7.05% of the shares outstanding. Mackenzie US Mid Cap Growth Class bought 0.36 million shares to see its total holdings expand to 4.87 million shares valued at over $83.98 million and representing 3.25% of the shares outstanding. Vanguard Total Stock Market Index bought 6655.0 shares to bring its total holdings to over 4.64 million shares at a value of $80.01 million. Vanguard Total Stock Market Index now owns shares totaling to 3.10% of the shares outstanding.

Shares of Verra Mobility Corporation (NASDAQ: VRRM) opened at $17.34, down -$0.03 from a prior closing price of $17.37. However, the script later moved the day high at 17.40, down -2.88%. The company’s stock has a 5-day price change of -4.80% and 14.84% over the past three months. VRRM shares are trading 21.98% year to date (YTD), with the 12-month market performance up to 4.39% higher. It has a 12-month low price of $12.70 and touched a high of $17.87 over the same period. VRRM has an average intraday trading volume of 2.01 million shares. The stock is trading above its simple moving averages at the SMA20, SMA50, and SMA200, as the current price level is off by 1.61%, 8.95%, and 7.32% respectively.

Institutional ownership of Verra Mobility Corporation (NASDAQ: VRRM) 149.19M shares outstanding. Mutual fund holders own 48.93%, while other institutional holders and individual stakeholders account for 58.49% and 17.33% respectively.

It has a market capitalization of $2.59B and a beta (3y monthly) value of 1.20. The stock’s trailing 12-month PE ratio is 28.84, while the earnings-per-share (ttm) stands at $0.58. The company has a PEG of 3.36 and a Quick Ratio of 1.80 with the debt-to-equity ratio at 5.24. Price movements for the stock have been influenced by the stock’s volatility, which stands at 2.28% over the week and 2.45% over the month.

Analysts forecast that Verra Mobility Corporation (VRRM) will achieve an EPS of $0.22 for the current quarter, $0.21 for the next quarter and $1.05 for 2023. The lowest estimate earnings-per-share for the quarter is $0.17 while analysts give the company a high EPS estimate of $0.25. Comparatively, EPS for the current quarter was $0.25 a year ago. Earnings per share for the fiscal year are expected to increase by 129.80%, and 15.08% over the next financial year. EPS should shrink at an annualized rate of 8.59% over the next five years, compared to 81.50% over the past 5-year period.

If you are looking to buy this stock, then you may note that the average analyst recommendation by 7 brokerage firm advisors rate Verra Mobility Corporation (VRRM) as a “Moderate Buy” at a consensus score of 2.10. Specifically, 4 Wall Street analysts polled rate the stock as a buy, while 3 of the 7 advise that investors “hold,” and 0 rated it as a “Sell.”

Looking at the support for the VRRM, a number of firms have released research notes about the stock. Robert W. Baird stated their Neutral rating for the stock in a research note on July 13, 2022, with the firm’s price target at $18. Deutsche Bank coverage for the Verra Mobility Corporation (VRRM) stock in a research note released on March 30, 2022 offered a Hold rating with a price target of $17. Morgan Stanley was of a view on May 26, 2021 that the stock is Equal-Weight, while Morgan Stanley gave the stock Equal-Weight rating on February 26, 2021, issuing a price target of $14. Northcoast on their part issued Buy rating on June 12, 2020.