Oppenheimer analyst Timothy Horan has maintained their neutral stance on APPS stock, giving a Hold rating today.
Timothy Horan’s Hold rating on Digital Turbine’s stock was influenced by several factors. Primarily, the company’s 2Q24 results fell below expectations, with a notable underperformance from the acquired App Growth Platform (AGP). This, combined with a substantial goodwill impairment charge of $147.2 million, resulted in disappointing revenue projections for the important holiday quarter, which were 8% below consensus and slightly below a double-digit year-on-year decline. In addition to these challenges, Horan pointed out that Digital Turbine is grappling with unique issues, with 3Q24 revenue expected to be half of its 3Q21 peak.
Furthermore, Horan highlighted that Digital Turbine’s performance has been lagging compared to its competitors, partially due to weak telco and a need to upgrade its adtech platform. While the company does have a differentiated on-device platform and is less expensive than its peers, investors are seeking double-digit sales and improved margins. Another concern is the 2Q24 SBC, which spiked by 56.0% year-on-year to $9M, contrasting with an 18.1% decrease in revenue, which could lead to dilution. Overall, these factors contribute to Horan’s Hold rating for Digital Turbine’s stock.
According to TipRanks, Horan is a 5-star analyst with an average return of 10.8% and a 63.26% success rate. Horan covers the Technology sector, focusing on stocks such as Microsoft, Extreme Networks, and Cambium Networks.
In another report released today, Roth MKM also maintained a Hold rating on the stock with a $5.00 price target.
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Digital Turbine (APPS) Company Description:
Digital Turbine, Inc. engages in the innovation of media and mobile communications which helps to deliver an end-to-end platform solution for mobile operators, application developers, device original equipment manufacturers (OEM), and other third parties. It operates through the Advertising segment, which is comprised of Operator and OEM (O&O) business. The O&O is an advertiser solution for unique and exclusive carrier and OEM inventory. The company was founded on November 6, 1998 and is headquartered in Austin, TX.
Read More on APPS:
- Digital Turbine Reports Fiscal 2024 Second Quarter Financial Results
- Digital Turbine options imply 18.9% move in share price post-earnings
- APPS Earnings this Week: How Will it Perform?
- Digital Turbine expands partnership with Xiaomi for app recommendations
- Digital Turbine call volume above normal and directionally bullish
