Roth MKM analyst Darren Aftahi maintained a Buy rating on Direct Digital Holdings (DRCT – Research Report) today and set a price target of $19.00.
Darren Aftahi has given his Buy rating due to a combination of factors surrounding the future potential of Direct Digital Holdings, despite recent setbacks. The company’s proactive shift away from third-party cookies and the anticipated integration of new tier-1 publishers are core elements expected to drive growth. While the fourth quarter results and the fiscal year 2024 guidance did not meet expectations, Aftahi believes these are temporary issues. He sees the deliberate move away from cookies as a strategic adjustment that could lead to normalization and benefits in the future, particularly as the company moves towards alternative identification methods ahead of the industry.
Additionally, Aftahi’s confidence is bolstered by Direct Digital Holdings’ projected year-over-year growth of around 15% and the potential for market share gains as the cookie-less environment develops in the second half of 2024. The report suggests that while the removal of cookies may impact smaller publishers, Direct Digital Holdings is well-positioned to navigate these changes. With the revised price target of $19 reflecting a significant upside from the current trading price, Aftahi maintains a Buy rating, indicating a belief in the company’s capacity to regain its high growth momentum and benefit from the upcoming industry shifts.
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Direct Digital Holdings (DRCT) Company Description:
Direct Digital Holdings Inc is an end-to-end, full-service programmatic advertising platform primarily focused on providing advertising technology, data-driven campaign optimization and other solutions to underserved and less efficient markets on both the buy- and sell-side of the digital advertising ecosystem.
