B. Riley has revised its price target for Outbrain (OB, Financial), lowering it from $5.25 to $4.25 while maintaining a Neutral rating on the stock. Following Outbrain's slight outperformance in the first quarter, the decision reflects caution due to macroeconomic uncertainties and the increased debt burden associated with the company's recent expansion. These factors contribute to the analyst's continued conservative outlook on the stock.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 5 analysts, the average target price for Outbrain Inc (OB, Financial) is $5.73 with a high estimate of $10.00 and a low estimate of $3.90. The average target implies an upside of 60.73% from the current price of $3.57. More detailed estimate data can be found on the Outbrain Inc (OB) Forecast page.
Based on the consensus recommendation from 5 brokerage firms, Outbrain Inc's (OB, Financial) average brokerage recommendation is currently 2.6, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Outbrain Inc (OB, Financial) in one year is $7.93, suggesting a upside of 122.44% from the current price of $3.565. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Outbrain Inc (OB) Summary page.
OB Key Business Developments
Release Date: May 09, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Outbrain Inc (OB, Financial) achieved its Q1 guidance for ex-tech gross profit and adjusted EBITDA, indicating strong financial performance.
- The merger with Teds has been successfully integrated, leading to significant milestones and synergies.
- The company has exclusive media relationships, providing access to a massive global inventory and proprietary data.
- Outbrain Inc (OB) has a diverse balance of advertiser segments and geographies, with a healthy mix of branding and performance campaigns.
- The CTV revenue grew over 100% year over year, showcasing strong growth in this segment.
Negative Points
- Despite the acquisition, there was a year-over-year decline of approximately 7% on a pro forma basis for the full quarter.
- The company incurred $16 million in acquisition-related costs and $16 million from the impairment of intangible assets.
- There is uncertainty in the macroeconomic environment, leading to shortened planning and buying cycles for advertisers.
- Free cash flow was negatively impacted by acquisition-related costs and restructuring charges, resulting in a use of cash of approximately $7 million.
- The company has a significant amount of long-term debt, with a net debt balance of $471 million.
