UPDATE: RBC Capital Starts Criteo S.A. (CRTO) at Outperform

RBC Capital initiated coverage on Criteo S.A. (NASDAQ: CRTO) with an Outperform rating and a price target of $64. Analyst Rohit Kulkarni said positive checks provide greater confidence in Criteo's competitive position.

"Over the past several months, we have talked with public company contacts (IR personnel at coverage companies and current CRTO customers), and private companies including AdRoll, Cardlytics, HookLogic, NetSeer, TellApart (acquired by TWTR), and Vizury. Plus, we think approx. 20% of CRTO’s TAC is paid to Google, implying $120MM+ in annual payments run-rate to GOOG, making it one of the largest GOOG AdX customers. And, we think approx. 12% of CRTO's net revs came from FB’s FBX in 2014, implying $60MM+ in annual payments run-rate to FB. With FB’s recent PMD reorg (dropping names such as Adobe & Rocketfuel), we think CRTO is now one of the largest PMDs with access to both FBX & dynamic product ads on mobile news feed. All in, our checks provide us with greater confidence in CRTO’s competitive position and ability to sustain above-industry growth rates over the “investable” future," said Kulkarni.

Kulkarni said key investment positives were, "1) Large, Fast-Growing Addressable Market: At $20B+ growing 20-25% Y/Y; 2) Leading Independent Performance Marketing Company: At $1B+ in ad spend optimizing CTRs, Conversions, & AOV; 3) Data-driven Sustainable Competitive Advantage: Direct access to advertiser & publisher 1st party data; 4) Advertiser & Publisher Friendly Business: Direct relations with 7,800+ advertisers and 10,000+ publishers; Higher CPMs make publishers happy; Higher ROAS makes advertisers happy; 5) Several Growth Opportunities: Creative optimization, email, cross-device, native, audience targeting."

For an analyst ratings summary and ratings history on Criteo S.A. click here. For more ratings news on Criteo S.A. click here.

Shares of Criteo S.A. closed at $51.34 yesterday.

You May Also Be Interested In

• Emkay Global Starts Urban Company (URBANCO:IN) at Buy (1)
• Goldman Sachs Downgrades AAC Technologies Holdings Inc. (2018:HK) (AACAY) to Neutral
• UBS Downgrades Klarna (KLAR) to Neutral