GICS Sector : Technology
Usio, Inc., together with its subsidiaries, provides integrated electronic payment processing services to merchants and businesses in the United States.The company offers various types of automated clearing house (ACH) processing; and credit, prepaid card, and debit card-based processing services.Its ACH transaction processing services include Represented Check, a consumer non-sufficient funds check that is presented for payment electronically rather than through the paper check collection system; and Accounts Receivable Check Conversion, a consumer paper check payment that is converted into an e-check.
Usio reported a solid Q3 FY2025, with total revenues relatively unchanged from the year-ago quarter but showing strong sequential momentum, up $1,200,000 from the previous quarter. ACH revenues were a standout, growing 30% year over year, driven by record volume. Adjusted EBITDA was $368,000, and operating cash flow was $1,400,000. The company's EPS came out at -$0.02, missing estimates of $0.01. The revenue growth is expected to continue, with analysts estimating a 10.6% increase in revenues for the next year.
Publication Date: Nov -30
The company's Card segment saw significant growth, with credit card dollars processed up 12% and transactions processed up 75% from a year ago. ACH was also a strong performer, with revenues up 30% year over year. According to Gregory Mark Carter, "September was a record quarter for Card, with an all-time quarterly record of transactions processed and the second-highest volume of card dollars processed in any quarter." The growth in ACH and Card segments is a positive sign for the company's future revenue growth.
Usio's valuation metrics indicate a relatively low price-to-sales ratio of 0.46, suggesting that the stock may be undervalued. The company's free cash flow yield is 16.72%, indicating a strong ability to generate cash. The company's cash position also improved, with cash and cash equivalents increasing by over $200,000 to $7,800,000 at quarter end. The company used approximately $60,000 for share repurchases, bringing the total year-to-date repurchases to $750,000.
The company is focused on recurring revenue and is seeing a great sense of momentum across the organization. Louis Hoch noted that the sales pipeline is rich, but the focus is on getting customers implemented faster. The company is also looking for strategic acquisitions that align with its strategy and create value for shareholders. With a strong balance sheet and positive cash flow, Usio is well-positioned to fund its growth and share repurchases while maintaining sufficient dry powder to capitalize on the favorable acquisition market.
Usio Acquires PostCredit Co
Nov -25
Usio, Inc. (USIO) Q3 2025 Earnings Call Transcript
Nov -13
Compared to Estimates, Usio (USIO) Q3 Earnings: A Look at Key Metrics
Nov -12
Usio Inc (USIO) Reports Q3 Loss, Misses Revenue Estimates
Nov -12
Usio Announces Third Quarter 2025 Financial Results
Nov -12
Usio Reports Record Third Quarter 2025 Processing Volumes
Nov -04
Usio to Host Third Quarter 2025 Conference Call to Discuss Results and Provide Company Update on November 12, 2025
Oct -30
Usio Inc. Earns 2025/2026 Great Place To Work Certification™
Aug -19
The 10.5% growth of Credit Card from Usio, Inc. is driven by increasing adoption of digital payments, rising e-commerce transactions, and growing consumer spending. Additionally, the company's strategic partnerships, innovative product offerings, and effective marketing strategies have contributed to the segment's expansion.
Usio's 11.2% growth is driven by increasing adoption of electronic payment systems, rising demand for payment processing services, and strategic partnerships. Additionally, the company's focus on innovation, expanding product offerings, and improving operational efficiency have contributed to its growth momentum.
Usio's Prepaid Card Services growth is driven by increasing adoption of cashless transactions, expanding partnerships with fintech companies, and rising demand for digital payment solutions. Additionally, the company's focus on underbanked and underserved markets, as well as its innovative product offerings, contribute to its 10.8% growth.
Usio's Automated Clearing House (ACH) and Complementary Services growth is driven by increasing adoption of digital payments, rising e-commerce transactions, and growing demand for efficient payment processing. Additionally, the company's expanding partnerships, innovative product offerings, and strategic acquisitions contribute to its 11.5% growth.
Automated clearing house (ACH) and card payment processing solutions for businesses
Payment processing solutions tailored for small to medium-sized businesses
Customized payment processing solutions for large enterprises
Integrated payment facilitation solutions for software companies and platforms
Payment processing solutions for card-not-present transactions
Automated clearing house (ACH) payment processing solutions
The threat of substitutes for Usio, Inc. is moderate due to the presence of alternative payment processing solutions.
The bargaining power of customers is low for Usio, Inc. as the company's payment processing solutions are highly specialized and customized to meet the needs of its clients.
The bargaining power of suppliers is moderate for Usio, Inc. as the company relies on a few key suppliers for its payment processing infrastructure.
The threat of new entrants is high for Usio, Inc. due to the relatively low barriers to entry in the payment processing industry.
The intensity of rivalry is high for Usio, Inc. due to the presence of several established players in the payment processing industry.
| Value | |
|---|---|
| Debt Weight | 18.32% |
| Debt Cost | 3.95% |
| Equity Weight | 81.68% |
| Equity Cost | 11.89% |
| WACC | 10.44% |
| Leverage | 22.42% |
Value: 5.0
Growth: 5.7
Quality: 6.1
Yield: 0.0
Momentum: 10.0
Volatility: 3.0
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