Analyst Andrew Boone of JMP Securities maintained a Buy rating on PubMatic (PUBM – Research Report), boosting the price target to $26.00.
Andrew Boone has given his Buy rating due to a combination of factors demonstrating PubMatic’s strong performance and positive outlook. PubMatic exceeded its first-quarter revenue and EBITDA forecasts, demonstrating robust execution amid a generally healthy digital advertising market. Boone highlights the company’s resilience despite a temporary setback due to a Demand-Side Platform (DSP) altering its bidding technology, which is expected to affect Cost Per Mille (CPM) growth rates only temporarily. He cites the company’s product innovations such as OpenWrap, Activate, Connect, and Convert as key drivers that will likely contribute to revenue growth and margin expansion in the future, particularly in 2025 when these products are anticipated to generate more significant revenue.
Furthermore, Boone underscores the strength seen in PubMatic’s Supply Path Optimization (SPO) activity, which now accounts for half of the company’s dealings and is projected to increase over time. The company’s strategic investments in its sales force to boost SPO and Activate initiatives, alongside an impressive spend retention rate among established ad buyers, are also noted as positive indicators. Boone also mentions the stabilization of headwinds from Yahoo, which has become a less significant revenue contributor after its acquisition by Apollo. These factors, combined with the expectation that PubMatic will maintain high EBITDA margins despite its investment phase, reinforce Boone’s confidence in the company’s financial health and justify the Buy rating and increased price target.
In another report released on May 8, Lake Street also reiterated a Buy rating on the stock with a $28.00 price target.
Based on the recent corporate insider activity of 80 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of PUBM in relation to earlier this year.
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PubMatic (PUBM) Company Description:
PubMatic Inc is engaged in the digital advertising business. The company provides specialized cloud infrastructure platform that enables real-time programmatic advertising transactions. The platform helps independent?app developers and publishers to control and maximize their?digital?advertising businesses.
