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Outbrain Inc. OB shares have surged 63% in the past year, outperforming the 28.5% rally of its industry while underperforming the 64.1% rise in the Zacks S&P 500 Composite.
OB’s performance is significantly higher than that of its industry peers, MediaAlpha, Inc. MAX and UiPath Inc. PATH. MAX has gained 5.7%, while PATH has declined 42.9% over the past year.
One Year Price Performance
Image Source: Zacks Investment Research
The surge in Outbrain’s shares might be appealing to investors. However, the important question is whether this is the right time to invest. Let us find out.
Premium Media Owner Partnerships Aid OB
Outbrain is focusing on strengthening its premium media owner partnerships, which are among its key strategic assets. These relationships ensure a consistent base of premium exclusive inventory while providing OB with the unique contextual and engagement insights that drive its performance and predictive capabilities. Outbrain has renewed agreements with important publishing partners, including Huffington Post and Meteo in France.
The company has secured new business partnerships from competitors and launched partners, including Sports one Germany and Reuters and Newsweek in Japan. This shows Outbrain’s superior value proposition when it comes to relationships with premium publishers across the globe.
AI Integration Looks Promising for Outbrain’s Success
OB is propelling AI integration into its performance and creative offerings, improving efficiency and prospects with an aim at sophisticated large-scale advertisers. The company is doing so via its creative automation suite that allows marketers to use AI to create new ad images, tailor images and adjust headlines to drive better results swiftly.
The creative automation suite delivers more relevant and highly targeted creatives optimized for customer engagement using OB’s predictive insights to fuel the product’s gen-AI.
Furthermore, the company expanded its collaboration with Microsoft Azure, integrating Azure OpenAI solution to an array of OB’s services. Outbrain expects the Azure solution to continue improving its existing creative solutions, prioritizing ad creatives with anticipated higher return on investment.
OB’s FY24 & FY25 Top & Bottom-Line Prospects Look Strong
The Zacks Consensus Estimate for Outbrain’s 2024 revenues is pegged at $237.8 million, implying 4.6% year-over-year growth. The consensus estimate for 2025 revenues is pinned at 262.7 million, suggesting 10.5% year-over-year growth.
The consensus estimate for OB’s 2024 earnings stands at 12 cents per share, indicating a turn-around from a loss of 8 cents reported in the preceding year. For 2025, the bottom line is pinned at 30 cents per share, hinting at a more than 100% year-over-year upsurge.