William Blair & Company initiated research coverage of BTRS Holdings, Inc. (BTRS $17.00). BTRS Holdings (Billtrust) is a leading provider of cloud-based software and integrated payment processing solutions that simplify and automate B2B commerce.
Analyst Robert Napoli estimated the company would generate revenue of $123 million in 2021, $149 million in 2022, and $175 million in 2023. He anticipates software and transaction revenues (70% of total revenue) should grow over 20% in coming years, while the low-margin print business (18% of total revenue) should continue to moderate.
“We view Billtrust as the leader in the accounts receivable, or AR, portion of the B2B payments market,” Napoli said, “and believe it has a sustainable competitive advantage driven by its deep technology, scale, and development of the Business Payments Network. Over 50% of B2B payments are still made by paper check; however, we believe the pandemic has accelerated the shift to digital. Billtrust is a leader in a very large high-growth market. There are over 280 billion global invoices produced annually and commercial payments is a $125 trillion market; electronic invoices are expected to grow at least 20% in coming years. While a leader, Billtrust has only a small share of the potential market opportunity. We believe Billtrust has the ability to grow substantially within its existing customer base and by adding new customers and entering new geographic markets. Subscription fees for Billtrust’s software modules will remain a key driver of growth, but we also believe Billtrust’s ability to monetize payments is a large growth opportunity and that the Business Payments Network is a key asset in that regard.”
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