Yahoo contributed to the growth of Taboola shares
2022.11.28 12:12
Yahoo contributed to the growth of Taboola shares
Budrigannews.com – Taboola the company’s announcement on Monday that it had signed a 30-year exclusive commercial agreement with Yahoo sparked an increase in shares.
Taboola, which will be available for purchase through the Yahoo DSP and will exclusively power native advertising across all of Yahoo’s digital properties, will generate approximately $1 billion in annual revenue. Yahoo will also acquire a nearly 25% stake in Taboola as a result.
In the first quarter of 2023, the agreement is expected to be signed.
After initially reaching a high of $3.27 per share at the beginning of Monday’s session, Taboola shares are currently up 51% at $2.79 per share.However, it is still a long way from its 2021 highs of more than $15 per share.
Needham & Company analysts outlined a few key investment benefits of the Yahoo deal for Taboola following the announcement of the transaction. These benefits included a significant upside to the scale of ad units that Taboola is able to sell, new Yahoo advertisers, incremental ad demand for Taboola’s DSP, and an upside to margin expansion as a result of its significantly larger revenue scale.
Analysts with a Buy rating and a $2.50 price target on Taboola wrote, “Apollo will take a board seat and have a meaningful equity share of TBLA, implying to us that Apollo may use TBLA as its public equity to amass more AdTech companies, or may buy TBLA for its tech stack and management team.”Funds managed by Apollo affiliates own Yahoo.
They added, “Data signals should improve materially with the addition of Yahoo’s ad inventory, which should improve all of TBLA’s recommendations and click-through rates (TBLA is only compensated for clicks).”
