Macquarie Upgrades Criteo S.A. (CRTO) to Outperform, Sees Upside After the Bounce
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Macquarie analyst Tim Nollen upgraded Criteo S.A. (NASDAQ: CRTO) from Neutral to Outperform with a price target of $40.00 (from $15.00) after the company reported a strong Q4 and positive guidance for 2021, while clearing the decks in quantifying an expected $60m hit from cookie and IDFA losses. Criteo reported a strong Q4 and positive guidance for 2021. Rev ex-TAC of $253m was -6% and beat guidance of $223-230m; adj. EBITDA of $103m beat guidance of $81-880m. Mgmt now guides to low-mid single digit rev ex-TAC growth in ‘21 at >30% adj. EBITDA margin, expanding for the first time since 2018.
The analyst sees CRTO as a new company and the numbers support the story. He stated "we had been waiting for evidence of progress and clarification of the cookie/IDFA impacts before gaining confidence in the upside. Even after this stock bounce, CRTO still only trades at <2x EV/sales vs software peers at 13x and at a 200bp discount to ad agencies at 5.5x EV/EBITDA despite a similar revenue trajectory & higher margins".
Shares of Criteo S.A. closed at $31.69 yesterday.
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