Lake Street Capital Markets Reiterates Hold Rating on PubMatic Inc (PUBM)

Lake Street Capital Markets analyst Eric Martinuzzi reiterated a Hold rating and $9.50 price target on PubMatic Inc (NASDAQ: PUBM).

The analyst comments "Reset May Take Time To Work Through – PubMatic’s solid Q2 saw upside from CTV (up over 50% y/y) and emerging revenue (Activate, sell side data, commerce media). However, the good result was overshadowed by a softer than expected Q3 guide. A large DSP unexpectedly reset its platform in July, sending shock waves through our forecast. This DSP, one of PubMatic’s top two, changed the way its engine valued PubMatic inventory, causing a reduction in ad spend. The impact began to stabilize in August as PubMatic set out to reshape its traffic. How They Plan To Fix Things – In the near term, PubMatic is tuning the settings of the buyers who make up its SPO demand to align with this DSP. It expects the process to take several months to normalize. In the long term, however, it has kicked in a renewed level of urgency to diversify away from the company’s reliance on legacy partners. The company’s top two DSPs (The Trade Desk and Google DV360) account for half of total spend. The company is having success with mid-tier and performance DSPs such as MNTN, tvScientific, and China- based performance DSPs, all of which are growing 20%+ y/y. Lowering Rating, PT – We lowered our numbers in line with Q3 guidance and have also reduced our Q4’25 and 2026 estimates. Our new 2025 full-year AEBITDA estimate is $51M vs our prior $68M. We lowered our rating to Hold and our price target to $9.50."

For an analyst ratings summary and ratings history on PubMatic Inc click here. For more ratings news on PubMatic Inc click here.

Shares of PubMatic Inc closed at $10.57 yesterday.

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