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1. Company Snapshot

1.a. Company Description

Consensus Cloud Solutions, Inc., together with its subsidiaries, provides information delivery services with a software-as-a-service platform worldwide.Its products and solutions include eFax, an online faxing solution, as well as MyFax, MetroFax, Sfax, SRfax, and other brands; eFax Corporate, a digital cloud-fax technology; jsign, which provides electronic and digital signature solutions; Unite, a single platform that allows the user to choose between several protocols to send and receive healthcare information in an environment that can integrate into an existing electronic health record (EHR) system or stand-alone if no EHR is present; Signal, a solution that integrates with a hospital's EHR system and uses rules-based triggering logic to automatically send admit, discharge, and transfer notifications using cloud fax and direct secure messaging technology; and Clarity that transforms unstructured documents into structured actionable data.It serves healthcare, education, law, and financial services industries.


Consensus Cloud Solutions, Inc.was incorporated in 2021 and is headquartered in Los Angeles, California.

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1.b. Last Insights on CCSI

The recent 3 months performance of Consensus Cloud Solutions, Inc. (CCSI) has been negatively impacted by the upcoming Q1 2025 earnings call on May 7, 2025, which may lead to increased scrutiny and potentially lower earnings expectations. The company's recent investor call and HIMSS25 exhibition, while showcasing its AI-powered solutions, may not be enough to offset the looming uncertainty surrounding its Q1 2025 financial results. Additionally, the lack of recent earnings releases and the focus on future guidance may indicate a period of consolidation for the company.

1.c. Company Highlights

2. Q3 2025 Earnings: Steady Growth and Promising Outlook

The company reported a solid Q3 2025 with revenue reaching $83.4 million, slightly above expectations. Adjusted EBITDA margin stood at 52.8%, generating $46.4 million in adjusted EBITDA. The actual EPS came out at $1.38, beating estimates of $1.36. Free cash flow was an exceptional $44.4 million, up 32% from $33.6 million in Q3 2024, demonstrating the company's ability to convert earnings into cash. The revenue growth was largely driven by the corporate channel, which saw a 6.1% increase over Q3 2024, reaching a record $56.3 million.

Publication Date: Nov -16

📋 Highlights
  • Q3 Revenue Growth:: Corporate channel revenue reached $56.3 million, a 6.1% increase from Q3 2024, driven by eFax Protect net adds and record usage.
  • Adjusted EBITDA Margin:: Achieved 52.8% margin, 60 basis points above Q3 2025 guidance midpoint, despite a $0.6 million decline in adjusted EBITDA ($46.4 million) due to headcount additions.
  • Free Cash Flow Surge:: Generated $44.4 million, up 32% from $33.6 million in Q3 2024, reflecting strong operational efficiency.
  • VA Revenue Potential:: Projected to exceed $5 million in 2025, with multi-year growth potential estimated at $10–$20 million as incumbent contracts expire and adoption expands.
  • Q4 2025 Guidance:: Revenue expected between $84.9–$88.9 million (midpoint $86.9 million), with adjusted EBITDA guidance of $43.1–$46 million (midpoint $44.5 million).

Segment Performance

The corporate channel continued to lead the way with record revenue and a record quarterly amount of net adds from the eFax Protect service. The VA segment also hit record revenue, driven by increased usage on weekdays and overall volume growth. As Johnny Hecker noted, "We're seeing increased usage in the existing base, but also continue to roll out to new facilities." This growth is expected to continue into 2026, with the potential for significant revenue expansion in the long term.

Guidance and Outlook

The company provided Q4 2025 guidance, with revenues expected between $84.9 million and $88.9 million, and adjusted EBITDA between $43.1 million and $46 million. The midpoint of the guidance implies a slight increase in revenue and a minor decrease in adjusted EBITDA compared to Q3 2025. Looking ahead to 2026, analysts estimate revenue growth at 1.0%. The company's advanced products, such as Clarity, an AI product, are performing well and driving revenue growth.

Valuation and Capital Allocation

With a P/E Ratio of 5.36 and an EV/EBITDA of 2.27, the company's valuation appears reasonable considering its growth prospects. The Free Cash Flow Yield stands at 21.36%, indicating a strong ability to generate cash. The company plans to consider retiring debt and share repurchases in 2026 on an opportunistic basis. As Jim Malone stated, "We will look at prepaying or repaying bank debt or credit facilities, such as the delayed draw term loan, and potentially paying down the revolver if we have excess cash."

Challenges and Risks

The SoHo segment may face marketing-related disruption, potentially causing a modest increase in the rate of decline in Q4 and possibly in Q1 2026. However, the company's diversified revenue streams and growing advanced products segment are expected to mitigate this risk. The VA segment's growth potential and the company's strong financial performance provide a solid foundation for long-term success.

3. NewsRoom

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Consensus Cloud Solutions Recognized Among Top Healthcare Technology Companies by The Healthcare Technology Report

Dec -02

Source: businesswire.com

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Jet.AI and Consensus Core Complete Second Milestone of Canadian Hyperscale Data Center Project

Nov -07

Source: globenewswire.com

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Consensus Cloud Solutions, Inc. (CCSI) Q3 2025 Earnings Call Transcript

Nov -06

Source: seekingalpha.com

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Consensus Cloud Solutions, Inc. (CCSI) Q3 Earnings Surpass Estimates

Nov -05

Source: zacks.com

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Consensus Cloud Solutions, Inc. Reports Third Quarter 2025 Results Releases Q4 2025 Guidance

Nov -05

Source: businesswire.com

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4 Best Value And Growth Stocks (Yes, They Can Coexist)

Oct -30

Source: seekingalpha.com

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All You Need to Know About Consensus Cloud Solutions (CCSI) Rating Upgrade to Buy

Aug -26

Source: zacks.com

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Consensus Cloud Solutions, Inc. (CCSI) Q2 2025 Earnings Call Transcript

Aug -08

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (12.29%)

6. Segments

Corporate Solutions

Expected Growth: 12.47%

Consensus Cloud Solutions' Corporate Solutions segment growth of 12.47% is driven by increasing demand for digital transformation, cloud-based workflow automation, and electronic signature solutions. The company's strategic acquisitions, expanding partner network, and growing adoption in industries such as financial services, healthcare, and government also contribute to its growth momentum.

Small Office Home Office (SoHo)

Expected Growth: 12.07%

Consensus Cloud Solutions' SoHo segment growth of 12.07% is driven by increasing adoption of cloud-based solutions, rising demand for digital transformation, and growing need for remote work enablement. Additionally, the shift towards paperless offices, cost savings, and scalability also contribute to this growth.

Other

Expected Growth: 10.27%

Consensus Cloud Solutions' 10.27% growth is driven by increasing demand for cloud-based integration and API management solutions, expansion into new markets, and strategic partnerships. Additionally, the company's focus on digital transformation, artificial intelligence, and machine learning capabilities also contribute to its growth momentum.

7. Detailed Products

FaxCore

A cloud-based faxing solution that enables users to send and receive faxes electronically, eliminating the need for physical fax machines and phone lines.

Consensus

A cloud-based interoperability platform that enables the secure exchange of patient data between healthcare providers, payers, and patients.

ODI (Open Delivery Interface)

A cloud-based platform that enables the secure and compliant exchange of sensitive documents and data between organizations.

AP Connect

A cloud-based platform that enables accounts payable automation, allowing businesses to electronically send and receive invoices and payments.

B2B Integration

A cloud-based platform that enables the secure and compliant exchange of business documents and data between organizations.

8. Consensus Cloud Solutions, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Consensus Cloud Solutions, Inc. operates in a niche market with limited substitutes, reducing the threat of substitutes.

Bargaining Power Of Customers

Customers have some bargaining power due to the availability of alternative cloud-based solutions, but Consensus Cloud Solutions, Inc.'s specialized services mitigate this power.

Bargaining Power Of Suppliers

Consensus Cloud Solutions, Inc. has a diversified supplier base, reducing the bargaining power of individual suppliers.

Threat Of New Entrants

While there are barriers to entry in the cloud-based solutions market, new entrants can still disrupt the market, posing a moderate threat to Consensus Cloud Solutions, Inc.

Intensity Of Rivalry

The cloud-based solutions market is highly competitive, with many established players, leading to a high intensity of rivalry for Consensus Cloud Solutions, Inc.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 131.46%
Debt Cost 8.08%
Equity Weight -31.46%
Equity Cost 12.04%
WACC 6.84%
Leverage -417.90%

11. Quality Control: Consensus Cloud Solutions, Inc. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Consensus Cloud Solutions

A-Score: 5.1/10

Value: 8.6

Growth: 2.4

Quality: 7.6

Yield: 0.0

Momentum: 8.0

Volatility: 3.7

1-Year Total Return ->

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Stock-Card
i3 Verticals

A-Score: 5.1/10

Value: 3.6

Growth: 4.8

Quality: 7.8

Yield: 0.0

Momentum: 8.5

Volatility: 5.7

1-Year Total Return ->

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Stock-Card
NetScout Systems

A-Score: 5.0/10

Value: 5.5

Growth: 1.7

Quality: 7.5

Yield: 0.0

Momentum: 8.0

Volatility: 7.0

1-Year Total Return ->

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Stock-Card
Priority Technology Holdings

A-Score: 4.7/10

Value: 7.4

Growth: 7.0

Quality: 4.8

Yield: 0.0

Momentum: 6.5

Volatility: 2.7

1-Year Total Return ->

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Stock-Card
SecureWorks

A-Score: 4.0/10

Value: 7.6

Growth: 1.1

Quality: 4.8

Yield: 0.0

Momentum: 6.0

Volatility: 4.7

1-Year Total Return ->

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Stock-Card
Rekor Systems

A-Score: 3.6/10

Value: 6.4

Growth: 3.3

Quality: 3.5

Yield: 0.0

Momentum: 8.0

Volatility: 0.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

22.51$

Current Price

22.51$

Potential

-0.00%

Expected Cash-Flows