DoubleVerify Holdings, Inc. (DV) stock experienced a pre-market plunge of 13.71% on Friday, February 28th, following the company's fourth quarter 2024 earnings release. The digital media measurement and analytics firm reported Q4 revenue of $190.6 million, missing analyst consensus estimates of $196.9 million.
The revenue miss appears to be the primary driver behind the sharp stock sell-off, despite DoubleVerify delivering solid full-year results with 15% revenue growth. Net income for Q4 came in at $23.4 million or $0.13 per share, falling short of the $0.18 EPS estimate.
According to reports, the weaker-than-expected Q4 performance was impacted by a slowdown in ad spending from large brand advertisers after the elections, with no anticipated rebound. Additionally, one of DoubleVerify's largest customers dramatically reduced its ad spend due to rising commodity costs as part of a broader cost-cutting initiative.
Despite the Q4 setback, some analysts still consider DoubleVerify's stock undervalued based on cash flow estimates, indicating potential upside if the company can regain momentum and meet future revenue projections. The company remains confident in its long-term growth prospects as it navigates these short-term challenges.
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