Analyst James Goss of Barrington reiterated a Buy rating on Quinstreet (QNST – Research Report), with a price target of $22.00.
James Goss has given his Buy rating due to a combination of factors including QuinStreet’s recent financial performance and positive sector trends. The analyst observed QuinStreet’s revenue alignment with expectations and a notable sequential revenue improvement driven by increased insurer profitability. The projection for the fourth quarter also indicates significant year-over-year growth, though slightly below initial estimates. The anticipated stronger growth in 2025 is expected to catalyze a return to margin expansion. The financial services segment of QuinStreet also displayed considerable improvement, with financial services revenue benefiting from the recovery in insurance spend and stable performance in credit-driven categories.
Additionally, Goss’s optimism is bolstered by QuinStreet’s diversification in the home services market, where it continues to identify growth pathways and has built a robust platform through strategic acquisitions. The outlook for the insurance spending in the upcoming quarter is positive, which is likely to support higher valuation multiples. Goss notes the potential for increased digital advertising budgets and a wider client base, which could lead to improved revenue streams. Despite potential market volatility, the analyst perceives the rebound in insurance spending and strengths in the home services and financial sub-verticals as justifications for the Buy rating. The raised price target reflects confidence in the company’s growth prospects and justifies a 26x multiple on the expected EBITDA for fiscal year 2025.
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Quinstreet (QNST) Company Description:
QuinStreet, Inc. engages in the provision of media management services. It operates through the United States and International geographical segments. Its platform offers performance marketing products based from number of clicks, inquiries, calls, applications, and full customer acquisitions. The company was founded on April 16, 1999 and is headquartered in Foster City, CA.
