May Idea of the Month: Online Advertising IPO Washout
by Travis Johnson, Stock Gumshoe | May 30, 2014 4:15 pm
Adding a new speculative stock for our consideration.
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Source URL: https://www.stockgumshoe.com/2014/05/may-idea-of-the-month-online-advertising-ipo-washout/
Sorry but I detest any of these recent internet companies with ridiculous P/E ratios and high-flying on the premise that they will someday make money (probably not). Too much like the internet balloon boondoggle that cut Nasdaq in half at the start of this century when reality finally set in. Grant Williams’ Things That Make You Go Hmmm has a recent article on this subject: http://www.mauldineconomics.com/ttmygh/pdf/the-underpants-gnomes
Of course, if this time you believe it’s different, would you like to buy a bridge?
There’s absolutely that risk. It’s not like the first internet boom when there wasn’t any revenue or profit associated with the names at all, but it is certainly forward-looking and could well not pan out. I like it when they’re already profitable and I think they can scale that profit with revenue ballooning, which I think is the case here, but there’s no certainty to it.
Stefan…If it is NOT different, then some internet stocks will go bankrupt or be bought out, and others will reward investors for the next 12 years.
There will surely be online ad companies into the future. Maybe CRTO will be a survivor. Given that it is, as Stock Gumshoe said, growing and profitable, it sounds to me like a great investment.
Any idea why the stock lost nearly 10% on Friday?
No specific news I’m aware of, other than the (unrelated) Google compliance with new data removal laws in Europe (that’s about public web info, not consumer tracking) but all of the newer ad-tech companies have been very volatile for a couple months now.
Since Vringo (VRNG) is likely to prevail against Google regarding the AdWords lawsuit and Google had mentioned loss by it’s customers could CRTO be involved? The subsequent rewrite by Google was also found to be still infringing. If they are hooked into AdWords I wonder if they may have some liability if they are reliant upon it to generate revenue.
Otherwise I like this company.
Favorable news Today, June 10, 2014
5:00 AM ET Industry Report Ranks Criteo #1 Display Retargeter in the US and UKPR Newswire
June 4, 2014
5:00 AM ET Criteo launches Advertising’s Next Generation Prediction Engine – Based on Actual Purchase BehaviorPR Newswire
As Sergeant Schultz of Hogan’s Heroes fame would say way to often, “Very Interesting.”
I’ve been thinking about CRTO all week, and comparing it with SPLK, the data mining
company which has also experienced a vicious decline in its stock price recently.
The Manny Backus Consensus Picks newsletter has been recommending Splunk
this week. On the fundamental level, CRTO is a much better stock than SPLK.
But might hedge funds and big banks go more for SPLK as a former darling,
with a way cooler name than Criteo, not to mention the red, white, and blue
factor? Er, okay, the French flag is also red, white and blue. But French or
American. Conservative dudes like O’Reilly and Stephen Colbert detest the
French. And aren’t the class of institutional buyers more likely to favor
SPLK over CRTO, perception being more important than fundamentals?
Great article Travis, and another very interesting pick.
Sergeant Schultz of Hogan’s Heroes fame always said “I know nothing……….”
Arte Johnson of Laugh in said “Very Interesting ,, but also stupid” both of these sayings may describe picking these stocks.