Goldman Sachs Downgrades Conversant (CNVR) to Sell (FUEL) (TWTR)

Goldman Sachs downgraded Conversant (NASDAQ: CNVR) from Neutral to Sell with a price target of $23.00 (from $22.00).

Analyst Debra Schwartz said, "While management has taken steps to refocus the company by divesting the no-longer-strategic O&O sites, realigning the organization, and making strategic tuck-in acquisitions, we believe risk of margin pressure resulting from an increasingly competitive ad tech environment will make further multiple expansion difficult until investors have proof of management’s ability to leverage its investment into a top-line reacceleration."

"The Internet sector is down 14% since March 7, and while we have little visibility on how long the selloff will last, we see attractive entry points ahead of 1Q earnings. Rocket Fuel (Nasdaq: FUEL) remains our top pick in ad tech as it, in our view, is at the cusp of growing penetration," he added.

On Twitter (NYSE: TWTR), Schwartz said, "We believe the accelerating user growth and engagement, supplemented by improvements in monetization, will drive continued financial outperformance in the year ahead. Twitter's ad tech exposure is largely through its acquisition of MoPub. We believe the company is well positioned to leverage its first party data to effectively run programmatic ad campaigns on non‐Twitter inventory."

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

Shares of Conversant closed at $27.12 yesterday.

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