Shares of online advertising software company PubMatic, Inc. (PUBM) popped 2.8% and closed at $34.70 in extended trade on Tuesday after the company reported stronger-than-expected results for the second quarter ended June 30, 2021. The company’s performance was primarily driven by growth in revenues.
Quarterly revenues stood at $49.7 million, up 88% from the same quarter last year, surpassing the Street’s estimates of $45.05 million. This growth was fueled by a 108% year-over-year increase in revenues from fast-growing advertising formats mobile and omnichannel video.
Further, earnings per share (EPS) of $0.18 topped analyst’s estimates of $0.08 per share.
For the third quarter of 2021, the company anticipates revenue to be in the range of $51 million to $53 million, while adjusted EBITDA is expected between $15 million and $16 million.
For the full year 2021, the company has raised its revenue guidance to $205 million to $209 million from $195 million to $200 million. The consensus for the same is pegged at $197 million. Also, adjusted EBITDA guidance for the year has been increased to $65 million to $68 million from $54 million to $58 million.
The CFO of PubMatic, Steve Pantelick, said, “Our outstanding performance in the quarter reflects the strength of our omnichannel platform, our usage-based business model, and our infrastructure-first approach to digital advertising. We benefit from a powerful network effect that is built on long-term, consistent investment in innovation that provides increased revenue visibility and operational scale which benefits our customers and us.” (See PubMatic stock chart on TipRanks)
Recently, RBC Capital analyst Matthew Swanson reiterated a Buy rating on the stock with a price target of $43, which implies upside potential of 27.3% from current levels.
Consensus among analysts is a Strong Buy based on 6 Buys and 1 Hold. The average PubMatic price target of $51.40 implies upside potential of 52.2% from current levels.
PubMatic scores a 7 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock is likely to perform in line with market expectations. Shares have gained 14.7% over the past year.
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