With the Wall Street Journal (http://nnw.fm/ePe6i) reporting that AppNexus filed its IPO paperwork, in a deal that is likely to be underwritten by Goldman Sachs (NYSE: GS) and JP Morgan Chase (NYSE: JPM), it’s time to review the ad tech landscape. After all, the deal is projected to be twice as large as the most recent ad tech IPO, The Trade Desk (NASDAQ: TTD), which commanded a premium of nearly 80% above its IPO price target and a $1 billion opening trading day valuation.
Despite the sagging economy, internet and mobile advertising has been growing by approximately 20% per year. Yet, despite the growth rate, the past two years have been tough for the industry, and venture funding for ad tech startups became harder to secure. As a result, any positive momentum is very welcome and may even explain the analysts’ enthusiasm for the players in the ad tech space, like The Trade Desk, which is rated a ‘Buy’, or stronger, with an average price target of $33.43 and a call as high as $40.00. Similarly, Social Reality (NASDAQ: SRAX), which uplisted to the NASDAQ Capital Market in October 2016, has its analysts calling it a ‘Buy’, on an EPS of 27 cents in 2017, with an average price target of $10.75 and the high target of $14.00.
With public sentiment experiencing one of the largest upswings in history on the heels of the Trump victory, many businesses can begin to take an expansionary stance toward the future, and marketing should be one of the big beneficiaries should that trend come to fruition.
The ad tech industry, at one point, was somewhat of an afterthought, but since it became a crucial piece of the monetization model for the web and mobile, the large marketing tech and vendor sites have been constantly looking for the next ad tech acquisition. Ad tech not only empowers the buying and selling of digital ad space on ad networks and exchanges, but it also includes analytics, data management platforms and other digital tools, which allow organizations to more effectively employ marketing campaigns that target specific audiences.
Social Reality is a leading provider of automated digital platform technology and social management software for Internet and mobile advertising. Management has consistently grown revenues, from about $500,000 in 2010 to over $30 million in 2015, representing an average annual growth rate (AAGR) of 170%, while typically running blended gross margins in the 45-55% range.
The Trade Desk is similar to Social Reality in that its technology is designed to empower ad buyers by providing a self-service platform that enables its clients to manage data-driven digital advertising campaigns.
The same economic dynamics that should benefit the ad tech sector go a long way in explaining why the financials have become the S&P 500’s best-performing sector since the election. Underwriters, like Goldman Sachs and JP Morgan Chase, should see a noticeable increase in IPOs and merger and acquisition activity.
The year of 2016 finished with 105 completed IPOs, according to Renaissance Capital (http://nnw.fm/25cI0), which was more than 2008 and 2009, but only 1/3-1/2 of the typical recent years’ volume.
J.P. Morgan and Goldman Sachs led an underwriting group for the trivago NV, the travel web search booking website, IPO on December 15.
For more information, please visit www.socialreality.com www.srax.com www.sraxmd.com www.sraxdi.com www.groupad.com www.steelmediainc.com www.sraxsocial.com
About Stock Communications Group (SCG)
Stock Communications Group (SCG) specializes in providing superior capital market communications. Our team of experienced tactical specialists can benefit public and private companies with proven financial strategies and solutions. Our investor relations and public relations services ensure that your company effectively communicates with investors, shareholders, regulators, and the financial community; to ensure that your company’s message properly promotes your company’s image, protects your brand, and maximizes your valuation.
SCG specializes in creating objective, credible, and timely communications that’s convenient and easy to understand. From conference call and annual meeting webcasts to creating special investor relations websites, we do it all. We even handle direct response duties to inquiries from individual investors, corporate profiles and other supporting publications, news releases and subscriber services. Our success stories span all industry sectors and are at the ready to deploy our unique resources to make your efforts truly successful.
SCG Disclosure: Stock Communications Group has been actively profiling public companies since 1999 bringing our readers timely and valuable market information first. Nothing in our reports or on our site should constitute a recommendation to buy or sell any stock. We will not be buying, selling or trading in any of the above listed stocks during the publication of this report. SCG has been compensated by MarketStreet for this article. Investors should conduct their own due diligence and consult with a stock broker or investment advisor before making any investment decision. Some of our statements are our opinion and should be taken as such, and this release contains Forward Looking statements as well.
Read our full disclosure at http://StockComm.com
About NetworkNewsWire
NetworkNewsWire (NNW) provides news aggregation and syndication, enhanced press release services and a full array of social communication solutions. As a multifaceted financial news and distribution company with an extensive team of journalists and writers, NNW is uniquely positioned to best serve private and public companies who need to reach a wide audience of investors, consumers, journalists and the general public. NNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, NNW brings its clients unparalleled visibility, recognition and brand awareness. NNW is where news, content and information converge.
For more information, visit https://www.NetworkNewsWire.com
Please see full disclaimers on the NetworkNewsWire website: http://nnw.fm/Disclaimer
No comments:
Post a Comment