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Mediaalpha, Inc. (MAX)
:MAX
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MediaAlpha
(NYSE:MAX)
58Neutral
Positive Factors
Earnings
MediaAlpha reported strong Q1 results, with Transaction Value, revenue, and adj. EBITDA all coming in solidly ahead of expectations.
Financial Performance
The Progressive Corporation's February results suggest continued solid growth in customer acquisition spend, which benefits online platforms like MediaAlpha.
Regulatory Settlement
If the company can reach a constructive resolution to the FTC matter, the stock would likely appreciate rapidly.
Negative Factors
Earnings Guidance
Q1 TV guidance is below consensus, with revenue and adj. EBITDA expectations also below estimates.
Regulatory Investigation
Uncertainty from the ongoing FTC investigation regarding the company’s under-65 health business will keep the stock under pressure in the near term.
Valuation
Valuation reflects a less stable EBITDA profile and near-term profitability challenges for MAX's customers in the P&C vertical.
MediaAlpha (MAX) vs. S&P 500 (SPY)
Market Cap
$676.05M
Dividend YieldN/A
Average Volume (3M)629.01K
Price to Earnings (P/E)33.2
Beta (1Y)1.00
Revenue Growth122.78%
EPS GrowthN/A
CountryUS
Employees144
SectorCommunication Services
Sector Strength83
IndustryInternet Content & Information
Share Statistics
EPS (TTM)0.30
Shares Outstanding55,895,645
10 Day Avg. Volume663,117
30 Day Avg. Volume629,009
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.03
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit4.85
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$16.29Price Target Upside69.86% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
MediaAlpha Business Overview & Revenue Model
Company DescriptionMediaAlpha, Inc., through its subsidiaries, operates an insurance customer acquisition platform in the United States. It optimizes customer acquisition in various verticals of property and casualty insurance, health insurance, and life insurance. The company was founded in 2014 and is headquartered in Los Angeles, California. MediaAlpha, Inc. is a subsidiary of White Mountains Insurance Group, Ltd.
How the Company Makes MoneyMediaAlpha generates revenue by connecting advertisers with publishers through its sophisticated programmatic platform. The company earns money primarily by taking a percentage of the transaction value when advertisers purchase media through its platform. This model allows MediaAlpha to benefit from the volume and value of transactions conducted via its system. Significant partnerships with major insurance companies, travel agencies, and other industries enhance its platform's attractiveness and drive revenue growth. MediaAlpha's transparent approach and data-rich environment enable advertisers to optimize their spending, which in turn encourages higher platform usage and increases transaction fees.
MediaAlpha Financial Statement Overview
Summary
MediaAlpha demonstrates a mixed financial profile. Revenue growth is on an upward trend, but profitability margins are thin, and the company faces high leverage risks. Cash flow performance is a strength, showing efficient cash generation, but balance sheet constraints could pose risks if not managed carefully.Income Statement
The company shows a mixed income performance with a TTM gross profit margin of 15.95% and net profit margin of 1.58%. Revenue growth has been volatile with recent TTM growth of 15.90%, suggesting improving sales. However, EBIT and EBITDA margins are relatively low at 4.09% and 3.94% respectively, indicating potential cost structure challenges.55
Neutral
Balance Sheet
The balance sheet reveals high leverage with a debt-to-equity ratio of 1.12. The return on equity (ROE) is modest at 199.49%, driven by low equity levels. The equity ratio is weak at 3.30%, suggesting financial instability and reliance on debt financing.40
Negative
Cash Flow
The cash flow statement reflects a solid position with a TTM free cash flow of $67.62 million and a robust operating cash flow to net income ratio of 4.30. The free cash flow to net income ratio is notably high at 4.28, indicating efficient cash generation relative to reported profits.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 864.70M | 388.15M | 459.07M | 645.27M | 584.81M | Gross Profit |
| 143.57M | 66.71M | 70.06M | 101.52M | 85.38M | EBIT |
| 42.73M | -39.92M | 39.70M | -1.69M | 19.54M | EBITDA |
| 44.53M | -34.43M | 46.60M | 2.15M | 20.72M | Net Income Common Stockholders |
| 16.63M | -40.42M | -72.45M | -8.47M | 10.56M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 43.27M | 17.27M | 14.54M | 50.56M | 23.55M | Total Assets |
| 262.45M | 153.93M | 170.08M | 289.80M | 213.93M | Total Debt |
| 162.44M | 174.30M | 183.07M | 186.80M | 182.67M | Net Debt |
| 119.18M | 157.03M | 168.53M | 136.24M | 159.11M | Total Liabilities |
| 308.68M | 248.35M | 256.17M | 351.37M | 315.45M | Stockholders Equity |
| 2.38M | -10.29M | -15.99M | -4.34M | -101.52M |
| Cash Flow | Free Cash Flow | |||
| 45.62M | 20.16M | 28.18M | 27.97M | 51.11M | Operating Cash Flow |
| 45.87M | 20.23M | 28.27M | 28.62M | 51.41M | Investing Cash Flow |
| -654.00K | -73.00K | -49.77M | -650.00K | -10.30M | Financing Cash Flow |
| -19.22M | -17.43M | -14.52M | -961.00K | -27.59M |
MediaAlpha Technical Analysis
Positive
9.59
Price Trends
8.91
Positive
10.20
Negative
13.14
Negative
Market Momentum
0.06
Negative
66.37
Neutral
72.14
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MAX, the sentiment is Positive. The current price of 9.59 is above the 20-day moving average (MA) of 8.15, above the 50-day MA of 8.91, and below the 200-day MA of 13.14, indicating a neutral trend. The MACD of 0.06 indicates Negative momentum. The RSI at 66.37 is Neutral, neither overbought nor oversold. The STOCH value of 72.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MAX.
MediaAlpha Risk Analysis
MediaAlpha disclosed 59 risk factors in its most recent earnings report. MediaAlpha reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
MediaAlpha Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $965.74M | 30.68 | 29.75% | ― | 73.72% | ― | |
80 Outperform | $1.54B | 23.31 | 9.18% | 4.54% | 26.71% | -23.67% | |
59 Neutral | $13.76B | 7.64 | -1.94% | 3.86% | 2.38% | -36.56% | |
58 Neutral | $676.05M | 33.23 | -115.07% | ― | 122.78% | ― | |
53 Neutral | $338.52M | ― | -0.31% | ― | -4.91% | -107.37% | |
53 Neutral | $595.28M | ― | -42.46% | ― | -10.12% | 72.31% | |
46 Neutral | $575.13M | ― | -19.38% | ― | 13.27% | 34.93% |
* Communication Services Sector Average
Performance Comparison
MAX
MediaAlpha
10.02
-12.18
-54.86%
EVER
EverQuote
26.71
4.96
22.80%
OPRA
Opera
17.47
4.35
33.16%
THRY
Thryv Holdings
13.61
-7.89
-36.70%
KIND
Nextdoor Holdings
1.50
-0.65
-30.23%
OB
Outbrain
3.59
-0.82
-18.59%
MediaAlpha Earnings Call Summary
Earnings Call Date:Apr 30, 2025
(Q1-2025)
| % Change Since: 14.17%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Neutral
The earnings call reflected strong financial performance with record results and significant growth in the P&C vertical, contributing to a positive outlook. However, challenges such as the increased FTC reserve, decline in the health insurance vertical, and potential impacts of automotive tariffs were notable concerns.Q1-2025 Updates
Positive Updates
Record First Quarter Financial Results
Delivered record first quarter financial results that exceeded guidance across key performance metrics, driven by a 116% year-over-year increase in transaction value to $473 million.
P&C Insurance Vertical Growth
Achieved 200% year-over-year growth in the P&C vertical, with transaction value surpassing expectations due to increased marketing investments by several carriers.
Adjusted EBITDA Growth
Adjusted EBITDA doubled year-over-year to $29.4 million, representing an increase from 52% to 67% of contribution.
Strong Cash Flow and Deleveraging
Achieved $20 million in cash flow, ending the quarter with approximately $64 million in cash and a net debt-to-adjusted EBITDA ratio of less than one times.
Positive Outlook for P&C Transaction Value
Projected P&C transaction value to grow approximately 65% to 75% year-over-year in Q2 2025.
Negative Updates
Increased FTC Reserve
Increased reserve related to the FTC Matter by $5 million, bringing the total reserve to $12 million.
Health Insurance Vertical Decline
Transaction value in the health vertical declined 17% year-over-year in Q1, with a further expected decline of 25% to 30% in Q2.
Write-off of Intangible Assets
Recognized a $13.4 million charge to write-off certain intangible assets acquired as part of the CHT acquisition.
Exit from Travel Vertical
Decided to exit the travel vertical by the end of Q2 2025, which contributed approximately $1 million of transaction value and $100,000 of profit in Q1.
Potential Impact of Automotive Tariffs
Automotive tariffs may put pressure on profitability in the P&C sector as the year progresses.
Company Guidance
During the MediaAlpha First Quarter 2025 Earnings Conference Call, guidance for the second quarter of 2025 was provided, indicating strong continued performance, particularly in the P&C (Property and Casualty) insurance vertical. The company expects P&C transaction value to grow between 65% and 75% year-over-year, while the health vertical is anticipated to decline by 25% to 30% due to a strategic focus shift towards Medicare Advantage. For the second quarter, consolidated transaction value is projected to be between $470 million and $495 million, representing a 50% year-over-year increase at the midpoint. Revenue is estimated to range from $235 million to $255 million, with an adjusted EBITDA forecasted at $25 million to $27 million, reflecting a 39% increase at the midpoint. MediaAlpha also highlighted strong cash flow generation and a net debt-to-adjusted EBITDA ratio of less than one times, reinforcing their optimistic near-term outlook despite potential challenges like automotive tariffs.MediaAlpha Corporate Events
Executive/Board Changes
MediaAlpha Appoints Bradley Hunt to Board of Directors
Positive
Mar 31, 2025
On March 31, 2025, MediaAlpha announced the appointment of Bradley Hunt to its Board of Directors, succeeding Jennifer Moyer, who decided not to stand for re-election. Hunt, a seasoned executive with extensive experience in the health insurance sector, is expected to enhance MediaAlpha’s market position and shareholder value. His appointment follows the company’s transition from being a controlled company in May 2024. Moyer’s departure marks the end of her significant contributions since MediaAlpha’s IPO, for which the board expressed gratitude.
Executive/Board Changes
MediaAlpha Updates Executive Compensation Plans for 2025
Neutral
Feb 10, 2025
On February 4, 2025, MediaAlpha’s Compensation Committee approved changes to the employment agreements of executives Steven Yi and Eugene Nonko. Steven Yi will now participate in the annual cash incentive plan starting with fiscal 2025 bonuses, replacing his previous performance-vesting restricted stock units. Eugene Nonko, who will retire as Chief Technology Officer on June 30, 2025, will not receive performance-vesting restricted stock units for 2025.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.