Northland Capital Markets Downgrades Angie's List (ANGI) to Underperform
Northland Capital Markets downgraded Angie's List (NASDAQ: ANGI) from Market Perform to Underperform with a price target of $5.50 (from $7.25) following mixed Q1 results.
Analyst Darren Aftahi commented, "ANGI reported a mixed 1Q with sales below, while profitability outperformed on lower than expected marketing spend. However, lower marketing spend yielded lower than expected gross and net adds combined with continuing decelerating sales growth, which both remain our focus. We believe this ultimately will translate into the company having to spend more on marketing, long term, to sustain growth in its member base to drive SP’s to continue to advertise/spend on the platform. We remain especially concerned as AMZN has thrown its hat into the services fulfillment ring, while Google is rumored to be introducing a competing product (something we believe may involve its investment in privately-held Thumbtack). With deep-pocketed entrants now present, we assign a lower multiple on ANGI’s ’16 EBITDA, which takes our PT to $5.50 from $7.25 and our rating to Underperform from Market Perform."
FY 2015 EPS goes from $0.11 to $0.19.
For an analyst ratings summary and ratings history on Angie's List click here. For more ratings news on Angie's List click here.
Shares of Angie's List closed at $6.46 yesterday.