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UPDATE: Outbrain Inc (OB) PT Lowered to $5.50 at Evercore ISI, Maintains In-line Following Q2 2022 Earnings Report

August 11, 2022 3:10 PM EDT
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Price: $4.12 +4.57%

Rating Summary:
    5 Buy, 1 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 4 | Down: 17 | New: 8
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(Updated - August 11, 2022 3:10 PM EDT)

Evercore ISI analyst Shweta Khajuria lowered the price target on Outbrain Inc (NASDAQ: OB) to $5.50 (from $6.00) while maintaining a In Line rating.

The analyst comments " Outbrain printed a Mixed and a major lower Q2 print. Q2 Gross Profit (ex-TAC) came in below the Street (and at the low-end of mgmt. guide) and EBITDA came in above Street expectations (and at the high-end of guide). Q3 and FY’22 guide came in well below expectations, as the company continues to face significant macro headwinds, especially in Europe (40%+ of OB’s business), with softness in advertiser demand pressuring CPCs, and FX. FY’22 guidance implies significant deterioration in fundamentals (-15 Y/Y revenue decline and 25- pt EBITDA margin compression Y/Y). We had downgraded OB shares to In Line rating last quarter on the premise that it would take several quarters before we see a fundamental inflection point, as we think Outbrain may be facing outsized headwinds from near term macro conditions (vs. some other Ad players) given the company’s exposure to international markets, Brand spend, and Ad formats. Maintain In Line and PT to $5. We will be hosting Yaron Galai (Co-CEO and Co-Founder), David Kostman (Co-CEO), and Jason Kiviat (CFO) of Outbrain at Evercore ISI’s TMT conference in NY on September 7-8."


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