John Blackledge, an analyst from TD Cowen, maintained the Hold rating on BuzzFeed (BZFD – Research Report). The associated price target is $1.00.
John Blackledge assigned a Hold rating to BuzzFeed’s stock (BZFD) due to a variety of reasons.
In the third quarter, BuzzFeed’s revenue not only fell short of the estimates of TD Cowen, but also came close to the lower end of the company’s own guidance. This was primarily due to a significant year-on-year decrease in both Advertising and Content revenues, which also fell below TD Cowen’s expectations. The fourth quarter revenue guidance also seemed unimpressive, being 18% below the TD Cowen’s estimate.
On the other hand, BuzzFeed’s EBITDA was above expectations, largely due to reduced costs across all operational lines. Despite a 29.3% year-on-year decline in revenue for the third quarter, which was attributed to lower-than-anticipated Content and Advertising revenues, this was somewhat offset by a better-than-expected performance in Commerce revenue. Moreover, BuzzFeed’s EBITDA margins improved in the third quarter due to cost efficiencies resulting from the company’s restructuring efforts.
Despite a lower revenue outlook for the fourth quarter, BuzzFeed’s management expects improved profitability. The management’s guidance foresees a year-on-year decline in the fourth quarter revenue but an increase in adjusted EBITDA. Thus, while BuzzFeed’s revenue performance and outlook were concerning, cost efficiencies and improved profitability expectations somewhat offset these concerns, leading to the Hold rating.
Blackledge covers the Technology sector, focusing on stocks such as Amazon, Netflix, and Meta Platforms. According to TipRanks, Blackledge has an average return of 8.9% and a 53.88% success rate on recommended stocks.
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BuzzFeed (BZFD) Company Description:
BuzzFeed is a digital media company. It offers news, entertainment, and shareable food content through its portfolio of online brands, including HuffPost, BuzzFeed Entertainment, and Tasty.
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