Laura Martin, an analyst from Needham, maintained the Buy rating on Magnite (MGNI – Research Report). The associated price target remains the same with $20.00.
Laura Martin’s rating is based on several positive indicators from Magnite’s recent performance and strategic initiatives. The company reported a significant year-over-year increase in Connected TV (CTV) revenues, which grew by 23% in the fourth quarter of 2024, outpacing the full-year average growth rate. This growth is further supported by the anticipation that Netflix will become Magnite’s largest CTV client by the end of 2025, indicating strong future revenue potential.
Additionally, Magnite is planning to introduce new generative AI features and tools in the fiscal year 2025, which are expected to reduce client churn and create new revenue streams. The company’s net leverage has also improved, decreasing to 0.4x from 0.9x in the previous quarter, reflecting a stronger financial position. Moreover, Magnite’s capital expenditure guidance for 2025 includes investments in on-premise servers, which are significantly more cost-effective than AWS, suggesting potential for margin expansion.
In another report released yesterday, Lake Street also reiterated a Buy rating on the stock with a $21.00 price target.