Needham analyst Laura Martin maintained a Buy rating on Magnite (MGNI – Research Report) today and set a price target of $18.00.
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Laura Martin has given her Buy rating due to a combination of factors that highlight Magnite’s strategic positioning and growth potential in the connected TV (CTV) advertising space. One of the key reasons is the company’s ability to capture a significant portion of CTV ad revenues through Magnite-sold ads, which have higher take rates compared to direct deals sold by CTV publishers. This shift towards more inventory being sold by Magnite is expected to drive revenue growth.
Additionally, Laura Martin notes that direct sold CTV ads command higher CPMs due to their content-based sales approach, which differentiates them from programmatic ads that are audience-based and thus have less pricing power. Furthermore, the increasing trend of live sports streaming, including the anticipated launch of ESPN’s new app, presents additional opportunities for Magnite to capitalize on unsold ad units in regional and niche sports leagues. These factors collectively contribute to a positive outlook for Magnite, justifying the Buy rating.
In another report released on May 8, Craig-Hallum also maintained a Buy rating on the stock with a $20.00 price target.