Usio, Inc. (USIO) DCF Valuation & Fundamental Primer
Usio, Inc. (USIO) trades at $7.32 with a market enterprise value of $198.5M and generated $92.6M in TTM revenue and -$237.2K in free cash flow (filed 2026-08-12 (period ended 2026-06-30)). Our 5-year DCF model estimates an implied intrinsic value of $0.03 per diluted share (Grade: B · 50/100 · Mixed Fundamental Profile).
SEC 10-K/10-Q DCF teardown of Usio, Inc. (USIO): $92.6M TTM revenue (8.4% growth), 22.3% GAAP gross margin, -0.3% FCF margin, 1.8% SBC/revenue, and Rule of 40 score of 8.1%.
Usio, Inc. (USIO) earns a "Pass" rating and an institutional Quality Score of 50/100 (Grade B). On $92.6M in baseline revenue (8.4% growth, 22.3% gross margin, -0.3% FCF margin), our 5-year DCF yields an Enterprise Value of -$4.2M ($0.03/share vs. $7.32 market price). On the R&D Return Benchmark, USIO ranks #152 of 174 (Burners · Grade C, 0.09× return).
Gross Margin & Unit Economics: Usio, Inc. operates at a 22.3% gross margin on $92.6M revenue (50.2 pts below the Software - Infrastructure median of 72.4%).
R&D Productivity (Burners · Grade C): Investing 21.0% of revenue in R&D ($19.4M) generates $0.09 of incremental gross profit per R&D dollar (Rank #152 of 174).
Rule of 40 & Cash Conversion: Combining 8.4% top-line growth with -0.3% FCF margin yields a 8.1% Rule of 40 score (vs. 38.4% cohort median) and -$4.2M DCF Enterprise Value.
3-Statement Financial Schedule & 5-Year Horizon
Synchronized directly with the 3-Year Operating Statement (22.3% Gross Margin · 8.4% Growth)
| Income Statement Line | Year 1 (2026) | Year 2 (2027) | Year 3 (2028) |
|---|---|---|---|
| Revenue | $92.6M | $100.3M | $108.7M |
| Cost of Revenue (COGS) | ($72.0M) | ($77.5M) | ($83.4M) |
| Gross Profit & Margin | $20.6M (22.3%) | $22.8M (22.8%) | $25.3M (23.3%) |
| Research & Development (R&D) | $19.4M | $20.2M | $21.0M |
| Sales & Marketing (S&M) | $1.6M | $4.8M | $5.0M |
| General & Administrative (G&A) | $641K | $2.9M | $3.0M |
| Operating EBIT | -$1.1M (-1.2%) | -$5.1M (-5.1%) | -$3.7M (-3.4%) |
| Adjusted EBITDA | $377K (0.4%) | -$3.5M (-3.5%) | -$2.0M (-1.8%) |
3 Key Underwriting Risks
Structural sensitivities monitored in the 3-Statement Financial Engine
Value-Creation Levers · Quantified Statement Impact
Apply any lever below to write its operating assumptions directly into the 3-Statement Model
Automate cloud hosting & support workflows to lift gross margin from 22.3% to 27.3%.
Align R&D intensity and ASC 350-40 capitalization to the R&D Compounders cohort median, recapturing $1.9M in annual EBITDA.
Lift net dollar retention and expansion velocity by +300 bps, compounding Year 3 revenue to $114.8M.
Usio, Inc. (USIO) 3-Scenario DCF Valuation Range
Stress-test USIO's 5-year growth, target FCF margin, WACC, terminal methodology, and SBC/dilution friction in real time.
Simulate how deploying Gemini workflow automation and autonomous engineering expands USIO's Gross Margin, FCF Margin, DCF share price, and 2x2 R&D Return Quadrant.
Split between 5-Year Explicit Cash Flows and Discounted Terminal Value
2D Institutional Valuation Sensitivity Heatmap
Implied share price & upside/downside spread across 25 valuation states (Current Price: $7.32).
| WACC \ Terminal | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 8.5% | $6.65 -9% | $7.04 -4% | $7.50 +2% | $8.05 +10% | $8.70 +19% |
| 9.3% | $6.00 -18% | $6.31 -14% | $6.67 -9% | $7.08 -3% | $7.57 +3% |
| 10.0% | $5.47 -25% | $5.72 -22% | $6.00 -18% | $6.33 -14% | $6.70 -8% |
| 10.8% | $5.03 -31% | $5.23 -29% | $5.46 -25% | $5.72 -22% | $6.01 -18% |
| 11.5% | $4.65 -37% | $4.82 -34% | $5.01 -32% | $5.22 -29% | $5.45 -26% |
Institutional Software Quality Scorecard (50/100 · Grade B)
Viable recurring software business but carries notable dilution, lower margins, or higher leverage.
Negative free cash flow; business consumes cash to sustain operations
Minimal dilution friction; management compensation aligned with shareholders
Sub-par gross margins; higher cost of delivery or hardware/services mix
Moderate leverage or cash burn; monitor liquidity runway
Core Investment Strengths & Moats
- Low dilution friction: SBC is only 1.8% of revenue
Key Operational & Dilution Risks
- Negative free cash flow burn of -$237.2K over trailing twelve months
- Lower software gross margins (22.3%), indicating higher hosting or service delivery drag
Compare Usio, Inc. (USIO) against the software universe on the 2x2 R&D Return vs. R&D Intensity matrix.
Reverse-DCF Solver: What Growth is Priced Into USIO?
Market implies 3.6% annual revenue growth over next 5 years (7.7% dilution-adjusted), in line with company run-rate.
Headline Reverse-DCF ignores Stock-Based Compensation (1.8% of revenue) and annual share dilution (2.1%/yr). Accounting for both requires 7.7% 5-year revenue CAGR to justify $7.32/sh on a true per-share economic cash flow basis.
Usio, Inc. (USIO) 5-Year Fundamental Forecast
| Statement Line Item | TTM Audited Base | TTM | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|---|---|
| Revenue | $92.6M | $92.6M | $100.3M | $108.7M | $117.8M | $127.6M | $138.3M |
| Gross Profit | $20.6M | $20.6M | $22.3M | $24.2M | $26.2M | $28.4M | $30.8M |
| Operating Income (EBIT) | -$1.1M | -$1.1M | -$1.2M | -$1.3M | -$1.4M | -$1.5M | -$1.7M |
| Stock-Based Compensation (SBC) | $1.7M | $1.7M | $1.9M | $2.0M | $2.2M | $2.4M | $2.6M |
| Unlevered Free Cash Flow (FCF) | -$237.2K | -$240.7K | -$260.8K | -$282.6K | -$306.2K | -$331.8K | -$359.6K |
| SBC-Adjusted True Cash Flow | -$1.9M | -$2.0M | -$2.1M | -$2.3M | -$2.5M | -$2.7M | -$2.9M |
Software - Infrastructure Peer Comparables & Rule of 40 Regression
Rule of 40 vs. EV / Revenue Multiple Regression
OLS Fit: EV/Rev = 6.6 + 0.05 × (Rule of 40) · R² = 12%Stocks below the gold regression line trade at a discount relative to their Rule of 40 compounding efficiency.
| Company | Ticker | Market Cap | TTM Revenue | Gross Margin | FCF Margin | Rule of 40 | SBC % Rev | EV / Rev |
|---|---|---|---|---|---|---|---|---|
| Usio, Inc. | USIO | $203.6M | $92.6M | 22.3% | -0.3% | 8.1% | 1.9% | 2.1× |
| Block, Inc. | XYZ | $41.67B | $25.04B | 46.4% | 15.5% | 23.7% | 4.8% | 1.6× |
| CoreWeave, Inc. | CRWV | $35.80B | $1.92B | 74.2% | -80.0% | 0.0% | 1.6% | 23.5× |
| VeriSign, Inc. | VRSN | $22.52B | $1.56B | 87.7% | 56.1% | 61.5% | 3.9% | 15.5× |
| CORPAY, INC. | CPAY | $22.17B | $3.97B | 78.1% | 44.4% | 52.1% | 2.9% | 7.2× |
| NetApp, Inc. | NTAP | $21.02B | $7.39B | 70.6% | 22.3% | 24.6% | 5.4% | 3.0× |
| Joint Stock Co Kaspi.kz | KSPI | $11,481.85B | $2,520.93B | 62.3% | 19.3% | 59.8% | — | 4.4× |
| Peer Cohort Median Benchmark (N=6) | 72.4% | 20.8% | 38.4% | 3.9% | 5.8× | |||
EV / Revenue Multiple Compression Stress Test
| Multiple Scenario | EV / Revenue | Implied Enterprise Value | Implied Equity Value | Implied Share Price | Delta vs Current |
|---|---|---|---|---|---|
| Current Multiple | 2.1× | $198.5M | $203.6M | $7.32 | 0.0% |
| -20% Multiple Compression | 1.7× | $158.8M | $163.9M | $5.89 | -20.0% |
| -35% Multiple Compression | 1.4× | $129.0M | $134.2M | $4.82 | -35.0% |
| Software Baseline Floor (5.0× EV/Rev) | 5.0× | $462.8M | $468.0M | $16.82 | +133.2% |
Frequently Asked Questions: Usio, Inc. (USIO) Valuation
What is Usio, Inc. (USIO)'s intrinsic DCF valuation and implied share price?
Based on audited SEC 10-K/10-Q filings and a 5-year 3-statement discounted cash flow (DCF) model, Usio, Inc. (USIO) has a Base Case implied value of $0.03 per share (with a Bear Case of $0.10 and a Bull Case of -$0.05), compared to its current price of $7.32. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.
What is Usio, Inc. (USIO)'s Rule of 40 score and Free Cash Flow margin?
Usio, Inc. achieves a Rule of 40 score of 8.1%, combining a 8.4% revenue growth run-rate with a -0.3% TTM free cash flow margin on $92.6M in trailing twelve-month revenue. In the Software - Infrastructure peer cohort, the median Rule of 40 benchmark is 38.4%.
What revenue growth rate is priced into USIO stock according to Reverse-DCF analysis?
At $7.32 per share (Enterprise Value of $198.5M), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of 3.6%, compared to Usio, Inc.'s historical CAGR of 8.4%. Overall market expectations are rated as "Fairly Priced to Fundamentals".
What is Usio, Inc. (USIO)'s R&D Return Score and innovation productivity?
Usio, Inc. (USIO) recorded N/A in FY R&D expense (tracked from SEC filings) and $19.7M in FY gross profit. It is currently unranked on the letter-grade leaderboard (pending full multi-year XBRL R&D history).
How does Usio, Inc. compare to Software - Infrastructure peers?
Usio, Inc. (USIO) earns an institutional Software Quality Score of 50/100 (Grade B — Mixed Fundamental Profile). Across its Software - Infrastructure peer group (XYZ, CRWV, VRSN, CPAY, NTAP), the cohort trades at a median EV/TTM Revenue multiple of 5.8× and a median gross margin of 72.4%.
How does Stock-Based Compensation (SBC) impact Usio, Inc. (USIO)'s valuation?
Usio, Inc. recorded $1.7M in TTM stock-based compensation (1.8% of revenue). When treating SBC as a cash-equivalent compensation expense, Usio, Inc.'s SBC-adjusted free cash flow yield is -1.0%, scoring 25/25 on our Shareholder Dilution Friction pillar.