Taboola.com, the Communication Services sector company, was revisited by a Wall Street analyst today. Analyst James Kopelman from TD Cowen reiterated a Buy rating on the stock and has a $4.00 price target.
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James Kopelman has given his Buy rating due to a combination of factors, including Taboola’s ability to outperform expectations on key profitability metrics even as headline revenue growth slowed. While gross revenue for the quarter came in modestly below consensus, the company delivered stronger-than-anticipated ex-TAC gross profit and EBITDA, supported by lower traffic acquisition costs and a favorable revenue mix shift toward higher-margin activities.
Moreover, management highlighted encouraging adoption trends for the Realize platform, reflected in growth in scaled advertisers and improved average revenue per advertiser, which underpin expectations for accelerating ex-TAC growth ahead. Although near-term guidance for revenue and EBITDA is somewhat softer than the Street’s forecasts, Taboola’s margin performance, operational momentum and above-consensus full-year outlook led Kopelman to maintain a positive stance and reaffirm a $4 price target.
In another report released yesterday, Needham also maintained a Buy rating on the stock with a $4.50 price target.