PubMatic (PUBM) AI Stock Analysis

• Market Cap: $615.41M
• Dividend Yield: N/A
• Average Volume (3M): 526.96K
• Price to Earnings (P/E): 149.5
• Beta (1Y): 1.49
• Revenue Growth: 3.62%
• EPS Growth: -53.21%
• Country: US
• Employees: 1,049
• Sector: Technology
• Sector Strength: 91
• Industry: Software - Application
• EPS (TTM): -0.20
• Shares Outstanding: 40,265,870
• 10 Day Avg. Volume: 546,370
• 30 Day Avg. Volume: 526,960
• PEG Ratio: -1.90
• Price to Book (P/B): 2.18
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 23.20
• Enterprise Value/Market Cap: 0.88
• Enterprise Value/Revenue: 0.47
• Enterprise Value/Gross Profit: 2.90
• Enterprise Value/Ebitda: 3.22
• 1Y Price Target: $16.00
• Price Target Upside: 28.31% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 75 Outperform
• Price Target: $14.50 ▲(16.28%Upside)

PubMatic's overall stock score is driven by strong technical indicators and a positive earnings call, highlighting strategic growth in key areas like CTV and AI. However, the high P/E ratio suggests overvaluation concerns, and financial performance shows mixed results with challenges in profitability.

Positive Factors

Ad Formats

The company has shifted the exposure of its business to faster growing ad formats, with desktop display now just 20% of revenue and CTV 20% of revenue.

Financial Performance

Despite the Q4 revenue miss, the company's AEBITDA exceeded expectations.

Revenue Streams

Emerging revenue streams doubled in 2024, reaching 6% of revenue.

Negative Factors

Political Ad Spending

The company faces tough comps from the absence of political ad spending in the second half of the year.

Revenue Comparisons

Pubmatic will be facing a headwind in the first half of the year while it anniversaries the prior year revenue comps from its large DSP.

PubMatic Business Overview & Revenue Model

Company Description

PubMatic, Inc. (NASDAQ: PUBM) is a leading digital advertising technology company that provides a cloud infrastructure platform aimed at enabling real-time programmatic advertising transactions for both publishers and advertisers. Operating primarily within the digital advertising and technology sectors, PubMatic offers solutions designed to optimize the value of ad impressions for publishers while delivering efficient and scalable advertising opportunities for brands across various digital platforms, including mobile, desktop, and connected TVs.

How the Company Makes Money

PubMatic makes money primarily through its programmatic advertising platform, which facilitates the buying and selling of digital advertising inventory in real time. The company's revenue model is based on a take-rate structure, where PubMatic earns a percentage of the transaction value each time an ad impression is successfully sold through its platform. Key revenue streams include fees from publishers for using its sell-side platform to manage and monetize their ad inventory, as well as fees from advertisers and agencies for accessing premium ad inventory through its demand-side integrations. Significant partnerships with major digital publishers and advertising agencies further enhance PubMatic's ability to attract a broad range of clients, contributing to its overall earnings.

PubMatic Financial Statement Overview

Summary

PubMatic demonstrates a mixed financial profile: strong balance sheet fundamentals with a solid equity position, but challenges in revenue growth and profitability margins. Cash flow remains positive but is under strain from increased capital investments.

Income Statement

PubMatic shows fluctuating revenue growth with a recent downturn. Gross and net profit margins are under pressure, with EBIT margins turning negative in the most recent TTM period. This indicates cost management challenges and potential profitability issues in the near term.

Balance Sheet

The company maintains a strong equity position with an improving equity ratio, though the debt-to-equity ratio has slightly increased due to rising liabilities. ROE has been inconsistent, reducing from prior highs, indicating pressure on shareholder returns.

Cash Flow

Operating cash flow remains positive, but free cash flow is declining, reflecting increased capital expenditures. The free cash flow to net income ratio suggests sufficient cash generation relative to profits, yet the trend of cash flow growth is weakening.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	291.26M	267.01M	256.38M	226.91M	148.75M
Gross Profit	190.23M	167.78M	174.87M	168.59M	107.56M
EBITDA	49.28M	46.81M	40.52M	58.79M	47.50M
Net Income	12.50M	8.88M	28.70M	56.60M	26.61M
Balance Sheet
Total Assets	739.52M	695.24M	642.17M	550.22M	371.25M
Cash, Cash Equivalents and Short-Term Investments	140.59M	175.34M	174.40M	159.63M	100.98M
Total Debt	45.38M	21.84M	26.59M	21.71M	1.56M
Total Liabilities	462.26M	399.04M	329.99M	293.04M	195.82M
Stockholders Equity	277.26M	296.20M	312.19M	257.18M	175.43M
Cash Flow
Free Cash Flow	55.83M	52.83M	38.32M	49.32M	-7.07M
Operating Cash Flow	73.42M	81.12M	87.21M	88.68M	24.33M
Investing Cash Flow	22.31M	-39.02M	-81.37M	-96.72M	-29.88M
Financing Cash Flow	-73.48M	-55.98M	4.04M	9.36M	52.48M

PubMatic Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 12.47
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PUBM, the sentiment is Positive. The current price of 12.47 is below the 20-day moving average (MA) of 12.53, above the 50-day MA of 11.94, and below the 200-day MA of 13.06, indicating a neutral trend. The MACD of 0.27 indicates Positive momentum. The RSI at 54.64 is Neutral, neither overbought nor oversold. The STOCH value of 35.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PUBM.

PubMatic Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CXM	78 Outperform	$2.35B	22.15	17.50%	―	6.75%	97.06%
PUBM	75 Outperform	$615.41M	149.53	1.94%	―	3.62%	-53.21%
OLO	71 Outperform	$1.72B	578.86	0.49%	―	23.31%	―
SEMR	70 Outperform	$1.45B	210.75	2.81%	―	22.75%	-47.45%
DSP	69 Neutral	$868.42M	461.13	4.15%	―	30.64%	―
Sector *	63 Neutral	$34.55B	5.25	-11.40%	1.91%	5.47%	-20.39%
ALKT	62 Neutral	$2.89B	―	-11.33%	―	26.55%	38.37%

PubMatic Corporate Events

PubMatic Stockholders Approve Key Proposals at Annual Meeting

On May 30, 2025, PubMatic, Inc. held its annual meeting of stockholders, where approximately 75.55% of the total outstanding shares were represented. During the meeting, stockholders approved the election of eight directors for a one-year term, ratified the appointment of Deloitte & Touche LLP as the independent registered accounting firm for 2025, and approved the compensation of the company’s named executive officers.

The most recent analyst rating on (PUBM) stock is a Buy with a $22.00 price target. To see the full list of analyst forecasts on PubMatic stock, see the PUBM Stock Forecast page.

PubMatic Increases Share Repurchase Program by $100M

On May 7, 2025, PubMatic‘s Board of Directors authorized a $100 million increase to its share repurchase program, allowing for the repurchase of up to $130.8 million of Class A common stock through December 31, 2026. This decision reflects the company’s strategic focus on enhancing shareholder value amidst favorable market conditions. PubMatic reported its first-quarter 2025 financial results, highlighting a revenue of $63.8 million and a net loss of $9.5 million. Despite a decrease in revenue compared to the previous year, the company showed growth in key areas such as CTV and omnichannel video, with CTV revenue growing over 50% year-over-year. The company continues to invest in product innovation and market expansion, positioning itself at the forefront of the shift towards programmatic and AI-driven advertising solutions.