What Happened?

Shares of programmatic advertising platform Pubmatic (NASDAQ: PUBM) fell 24% in the morning session after the company reported weak fourth-quarter results: its revenue and EBITDA guidance for the next quarter fell short of Wall Street's estimates. On the other hand, PubMatic beat analysts' EPS and EBITDA expectations this quarter. We note that ad tech companies had weaker quarters in general, as both The Trade Desk and DoubleVerify missed on revenue and guided below for next quarter. PubMatic wasn't spared, and the stock traded down.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy PubMatic? Access our full analysis report here, it’s free.

What The Market Is Telling Us

PubMatic’s shares are quite volatile and have had 17 moves greater than 5% over the last year. But moves this big are rare even for PubMatic and indicate this news significantly impacted the market’s perception of the business.

PubMatic is down 27.2% since the beginning of the year, and at $10.80 per share, it is trading 55% below its 52-week high of $24.02 from May 2024. Investors who bought $1,000 worth of PubMatic’s shares at the IPO in December 2020 would now be looking at an investment worth $366.72.

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