Needham & Company Downgrades Rocket Fuel (FUEL) to Buy

Needham & Company downgraded Rocket Fuel (NASDAQ: FUEL) from Strong Buy to Buy with a price target of $30.00 (from $75.00).

Analyst Kerry Rice said, "We are downgrading Rocket Fuel from STRONG BUY to BUY given its slower growth outlook. The company lowered its revenue and EBITDA guidance for FY14 primarily due to lower spending from agencies’ internal trading desks. Management indicated efforts to strengthen its relationship with agencies improved growth trends in July. We believe Rocket Fuel's acquisition of X+1 should also strengthen relationships with agencies and advertisers via its Data Management Platform. While disappointed with guidance, we believe the company's competitive technology advantages remain intact, which should translate into healthy revenue growth of 64% in FY14 and market share gains."

The firm cut FY 2014 EPS from ($0.23) to ($0.61) and FY 2015 EPS from $0.56 to $0.07.

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

Shares of Rocket Fuel closed at $24.75 yesterday.

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