Integral Ad Science (IAS) AI Stock Analysis

• Market Cap: $1.69B
• Dividend Yield: N/A
• Average Volume (3M): 3.81M
• Price to Earnings (P/E): 30.3
• Beta (1Y): 1.37
• Revenue Growth: 14.39%
• EPS Growth: 1946.11%
• Country: US
• Employees: 902
• Sector: Communication Services
• Sector Strength: 97
• Industry: Advertising Agencies
• EPS (TTM): 0.10
• Shares Outstanding: 166,163,510
• 10 Day Avg. Volume: 9,693,335
• 30 Day Avg. Volume: 3,806,149
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.79
• Enterprise Value/Revenue: 2.33
• Enterprise Value/Gross Profit: 2.98
• Enterprise Value/Ebitda: 9.08
• 1Y Price Target: $11.13
• Price Target Upside: 9.44% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 14

• Rating: 77 Outperform
• Price Target: $10.00 ▼(-1.67% Downside)

Integral Ad Science's strong financial performance and positive earnings call are the most significant factors driving its stock score. The company shows robust growth and profitability, supported by strategic international expansion and partnerships. However, the high P/E ratio suggests potential overvaluation, and technical indicators point to a possible overbought condition, which could impact future price movements.

Positive Factors

Revenue Growth

The consistent revenue growth indicates strong market demand and effective product strategies, supporting long-term business expansion.

International Expansion

International growth diversifies revenue streams and reduces dependency on domestic markets, enhancing global market presence and resilience.

Strategic Partnerships

Strategic partnerships expand service offerings and customer base, fostering innovation and competitive advantage in the ad tech industry.

Negative Factors

Decline in Open Web Revenue

Declining Open Web revenue suggests shifting advertiser preferences, potentially impacting future revenue if not addressed.

Volatility in Measurement Revenue

Volatility in measurement revenue could indicate market instability, affecting predictability and planning for future growth.

Acquisition by Novacap

The acquisition may lead to strategic shifts and integration challenges, impacting operational focus and long-term strategic direction.

Integral Ad Science Business Overview & Revenue Model

Company Description

Integral Ad Science Holding Corp. operates as a digital advertising verification company in the United States, the United Kingdom, Germany, Italy, Spain, Sweden, Singapore, Australia, France, Japan, Canada, India, and Brazil. The company provides IAS Signal, a cloud-based technology platform that offers actionable insights; and deliver independent measurement and verification of digital advertising across devices, channels, and formats, including desktop, mobile, connected TV, social, display, and video. Its digital media quality solutions offer ad fraud detection and prevention, viewability, brand safety and suitability, contextual targeting, inventory yield management, and reporting. The company offers Quality Impressions, a metric designed to verify that digital ads are served to a real person rather than a bot, viewable on-screen, and presented in a brand-safe and suitable environment in the correct geography; Context Control solution that delivers contextual targeting and brand suitability capabilities; pre-bid programmatic and post-bid verification solutions for advertisers; and optimization and verification solutions for publishers. It serves advertisers and agencies, publishers, advertising/audience networks, and supply side platforms. The company was founded in 2009 and is headquartered in New York, New York.

How the Company Makes Money

IAS generates revenue primarily through subscription-based services and transactional fees for its suite of measurement and verification products. Key revenue streams include fees charged to advertisers and publishers for access to its analytics and reporting tools, often offered through annual or multi-year contracts. Additionally, IAS partners with various advertising platforms, agencies, and technology providers, leveraging these relationships to expand its customer base and enhance service offerings. The company's ability to provide actionable insights and ensure compliance with industry standards further drives its earnings.

Integral Ad Science Financial Statement Overview

Summary

Integral Ad Science exhibits strong financial health across all verticals. The income statement shows consistent revenue and profit growth, the balance sheet reflects low leverage and strong equity, and cash flow metrics indicate robust cash generation and liquidity. The company is well-positioned for continued growth and stability in the advertising industry.

Income Statement

Integral Ad Science has demonstrated strong revenue growth with a TTM increase of 3.68% and consistent annual growth. The company maintains healthy profitability with a gross profit margin of 78.03% and a net profit margin of 9.79% in the TTM period. EBIT and EBITDA margins are also robust, indicating efficient operations. Overall, the income statement reflects a positive growth trajectory and strong profitability.

Balance Sheet

The balance sheet shows a strong equity position with a low debt-to-equity ratio of 0.0259 in the TTM period, indicating low leverage and financial stability. Return on equity has improved to 5.44%, reflecting better utilization of equity. The equity ratio is solid, suggesting a strong capital structure. Overall, the balance sheet is stable with low risk.

Cash Flow

Cash flow analysis reveals a significant improvement in free cash flow growth at 38.33% in the TTM period, indicating strong cash generation. The operating cash flow to net income ratio of 2.06 suggests efficient cash conversion. The free cash flow to net income ratio is high at 0.93, reflecting strong cash profitability. Overall, cash flow metrics are robust and indicate healthy liquidity.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	569.84M	530.10M	474.37M	408.35M	323.51M	240.63M
Gross Profit	444.66M	416.14M	375.02M	332.59M	268.94M	200.13M
EBITDA	146.24M	124.35M	72.06M	72.53M	25.55M	51.83M
Net Income	55.76M	37.80M	7.24M	15.37M	-52.44M	-32.37M
Balance Sheet
Total Assets	1.17B	1.15B	1.19B	1.17B	1.13B	849.58M
Cash, Cash Equivalents and Short-Term Investments	90.69M	84.47M	124.76M	86.88M	73.21M	51.73M
Total Debt	27.80M	57.75M	182.68M	252.89M	244.77M	351.40M
Total Liabilities	98.63M	143.56M	282.27M	360.47M	362.35M	418.10M
Stockholders Equity	1.07B	1.01B	909.46M	808.22M	767.19M	431.48M
Cash Flow
Free Cash Flow	140.79M	77.35M	97.87M	55.78M	49.94M	24.27M
Operating Cash Flow	151.86M	117.90M	131.62M	72.47M	63.59M	33.94M
Investing Cash Flow	-42.53M	-40.54M	-34.72M	-18.29M	-200.09M	-9.66M
Financing Cash Flow	-91.84M	-116.38M	-58.85M	-37.47M	160.19M	-1.70M

Integral Ad Science Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 10.17
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IAS, the sentiment is Positive. The current price of 10.17 is above the 20-day moving average (MA) of 8.97, above the 50-day MA of 8.78, and above the 200-day MA of 8.86, indicating a bullish trend. The MACD of 0.36 indicates Negative momentum. The RSI at 71.54 is Negative, neither overbought nor oversold. The STOCH value of 97.02 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IAS.

Integral Ad Science Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IAS	77 Outperform	$1.69B	30.35	5.52%	―	14.39%	1946.11%
CRTO	75 Outperform	$1.30B	9.47	12.54%	―	-0.40%	36.44%
ZD	74 Outperform	$1.59B	26.23	3.59%	―	5.94%	-8.89%
STGW	68 Neutral	$1.42B	507.21	-0.22%	―	9.56%	―
QNST	65 Neutral	$897.31M	197.32	1.93%	―	78.27%	―
EEX	64 Neutral	$1.01B	127.57	2.03%	1.18%	9.96%	―
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%