Reflecting On Advertising & Marketing Services Stocks’ Q4 Earnings: QuinStreet (NASDAQ:QNST)

As the Q4 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the advertising & marketing services industry, including QuinStreet (NASDAQ:QNST) and its peers.

The sector is on the precipice of both disruption and growth as AI, programmatic advertising, and data-driven marketing reshape how things are done. For example, the advent of the Internet broadly and programmatic advertising specifically means that brand building is not a relationship business anymore but instead one based on data and technology, which could hurt traditional ad agencies. On the other hand, the companies in the sector that beef up their tech chops by automating the buying of ad inventory or facilitating omnichannel marketing, for example, stand to benefit. With or without advances in digitization and AI, the sector is still highly levered to the macro, and economic uncertainty may lead to fluctuating ad spend, particularly in cyclical industries.

The 6 advertising & marketing services stocks we track reported a mixed Q4. As a group, revenues beat analysts’ consensus estimates by 1.5% while next quarter’s revenue guidance was above.

Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 12.3% since the latest earnings results.

QuinStreet (NASDAQ:QNST)

Founded during the dot-com era in 1999 and specializing in high-intent consumer traffic, QuinStreet (NASDAQ:QNST) operates digital performance marketplaces that connect clients in financial and home services with consumers actively searching for their products.

QuinStreet reported revenues of $282.6 million, up 130% year on year. This print exceeded analysts’ expectations by 17.9%. Overall, it was a very strong quarter for the company with full-year revenue guidance exceeding analysts’ expectations and an impressive beat of analysts’ EPS estimates.

QuinStreet achieved the biggest analyst estimates beat, fastest revenue growth, and highest full-year guidance raise of the whole group. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 27.3% since reporting and currently trades at $18.29.

We think QuinStreet is a good business, but is it a buy today? Read our full report here, it’s free.

Best Q4: Liberty Broadband (NASDAQ:LBRDK)

Operating across the United States, Liberty Broadband (NASDAQ:LBRDK) is a provider of high-speed internet, cable television, and telecommunications services across various markets.

Liberty Broadband reported revenues of $263 million, up 5.2% year on year, outperforming analysts’ expectations by 0.9%. The business had an exceptional quarter with an impressive beat of analysts’ EPS estimates.

The market seems content with the results as the stock is up 3.4% since reporting. It currently trades at $83.98.

Is now the time to buy Liberty Broadband? Access our full analysis of the earnings results here, it’s free.

Weakest Q4: Magnite (NASDAQ:MGNI)

Born from the 2020 merger of Rubicon Project and Telaria, Magnite (NASDAQ:MGNI) operates the world's largest independent sell-side advertising platform that automates the buying and selling of digital advertising inventory across all channels and formats.

Magnite reported revenues of $194 million, up 3.8% year on year, falling short of analysts’ expectations by 6.1%. It was a disappointing quarter as it posted a significant miss of analysts’ EPS estimates.

Magnite delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 20.4% since the results and currently trades at $13.41.

Read our full analysis of Magnite’s results here.

Omnicom Group (NYSE:OMC)

With a vast network of creative agencies that helped craft some of the most memorable ad campaigns in history, Omnicom Group (NYSE:OMC) is a strategic holding company that provides advertising, marketing, and communications services to many of the world's largest companies.

Omnicom Group reported revenues of $4.32 billion, up 6.4% year on year. This print was in line with analysts’ expectations. More broadly, it was a mixed quarter as its performance in some other areas of the business was disappointing.

The stock is down 8.1% since reporting and currently trades at $79.92.

Read our full, actionable report on Omnicom Group here, it’s free.

Interpublic Group (NYSE:IPG)

With a history dating back to 1902 and roots in the McCann-Erickson agency, Interpublic Group (NYSE:IPG) is a marketing and communications holding company that owns agencies specializing in advertising, media buying, public relations, and digital marketing services.

Interpublic Group reported revenues of $2.43 billion, down 5.9% year on year. This result came in 3.1% below analysts' expectations. Overall, it was a disappointing quarter as it also logged a significant miss of analysts’ EPS estimates and a miss of analysts’ organic revenue estimates.

Interpublic Group had the slowest revenue growth among its peers. The stock is down 1.2% since reporting and currently trades at $26.47.

Read our full, actionable report on Interpublic Group here, it’s free.

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