On Wednesday, DA Davidson adjusted its outlook on Criteo S.A. (NASDAQ:CRTO), a global technology company that provides marketing and monetization services on the internet. The firm lowered its price target to $53.00 from the previous $58.00 while sustaining a Buy rating on the shares.
The revision comes as DA Davidson recalibrates its estimates, citing a 3% decrease in the 2025 CexT estimate, attributed to reduced Iponweb revenues. Additionally, the firm has adjusted its 2025 adjusted EBITDA forecast, decreasing it by $9 million to $387 million.
Despite the reduced price target, DA Davidson reaffirms its positive stance on Criteo's stock. The firm's analyst believes that at its current price of $34.40, CRTO shares are undervalued. The stock is trading at 4.7 times the firm's 2025 EV/EBITDA estimate, which is considered inexpensive for a company that is expected to achieve high-single digit growth next year.
Criteo's attractiveness as an investment is further supported by its projected adjusted EBITDA margins of approximately 32% or higher. The firm also notes that the company's risk profile has improved following developments in the Chrome browser privacy landscape.
In summary, while DA Davidson has reduced its price target for Criteo, the firm maintains a Buy rating, signaling confidence in the company's growth prospects and financial health. The new price target of $53 implies a valuation of 7.5 times DA Davidson's 2025 EV/EBITDA estimate for Criteo.
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