Magnite's (NASDAQ: MGNI) stock dropped 16% on Feb. 23 after the advertising technology company posted its fourth quarter earnings report the evening before. Excluding its traffic acquisition costs (ex-TAC), its revenue rose 10% year over year to $156.6 million and exceeded analysts' estimates by $3.1 million.
Its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) dipped 5% to $64.2 million, which compressed its adjusted EBITDA margin from 48% to 41%. That trickled down to an adjusted profit or $0.24 per share, which missed analysts' expectations by $0.08. On an unadjusted basis, it posted a net loss of $36.4 million, compared to a profit of $500,000 in the prior-year quarter.
Magnite's sluggish growth was disappointing, but it wasn't too surprising in this tough macroeconomic environment for advertising companies. Let's take a fresh look at the bear and bull cases to see if this stock is still worth buying.
Source Fool.com