Perion Network (PERI) reports optimistic preliminary results for the second quarter
Perion network PERI released strong preliminary results for the second quarter of 2021 on June 28. The ad technology company is now forecasting revenue of $ 105 million, which suggests 74% growth from the figure reported in the last quarter quarter and 17% growth on a sequential basis.
Additionally, Adjusted EBITDA is expected to rise to $ 13.5 million, indicating a whopping 440% increase over the figure reported in the last year quarter and 53% growth on a sequential basis. .
Notably, in the first quarter of 2021, revenue climbed 36% year-on-year to $ 89.8 million, while Adjusted EBITDA jumped 41% to $ 8.8 million.
Zacks’ consensus estimate for revenue is currently set at $ 95.9 million, which suggests growth of 58.9% from the figure reported in the quarter of last year. The consensus mark for earnings has doubled in the past 60 days to 8 cents a share.
What awaits Perion’s actions in 2021?
Perion shares jumped 16.3% to close at $ 21.70 on June 28. The company has returned 46.5% year-to-date against the 0.3% decline in Zacks’ internet content industry.
Perion Network Ltd Price and consensus
Perion Network Ltd price-consensus-chart | Perion Network Ltd quote
Perion’s outperformance in the first half of 2021 can be attributed to its strong product portfolio. Second quarter 2021 ad revenue is expected to have benefited from strong video advertising. In addition, research income is also expected to have reached an all-time high.
Notably, in the first quarter of 2021, display and social advertising revenue jumped 61% year-over-year to $ 38.1 million. In addition, Search Network and other advertising revenue increased 22% year-on-year to $ 51.7 million.
Perion’s revenue benefited from a recovery in advertiser spending and higher e-commerce advertising spending which offset the decline in travel and entertainment.
Continuing changes in consumer behavior, which has fueled the growing use of e-commerce services, are expected to keep advertiser spending high in the near term. Perion should also benefit from the solid performance of its search activity, driven by strong demand from advertisers.
In particular, the partnership with Microsoft ‘s The MSFT Bing search engine has helped Perion gain publishers’ trust in its search offerings. Notably, in the first quarter, the daily number of searches was 17.7 million compared to 12.2 million in the quarter of the previous year. In addition, the company added 13 new publishers.
These factors bode well for Perion’s outlook for the remainder of 2021.
Perion raises its outlook for 2021
Perion also raised its forecast for 2021 based on strong expectations for the second quarter. The company now forecasts revenue between $ 410 million and $ 430 million with growth of 28% year-over-year.
Adjusted EBITDA is expected to be between $ 49 and $ 51 million, indicating 52% year-over-year growth. Adjusted EBITDA margin is expected to increase 200 basis points (bps) year-on-year to 12%.
Notably, Zacks’ consensus estimate for 2021 revenue stands at $ 393.7 million, indicating a 20% growth from the figure released in 2020. Additionally, the Consensus Mark for earnings is set at 44 cents per share, up 25% over the past 60 days.
Zacks rank and actions to consider
Currently, Perion has a Zacks Rank # 3 (Hold).
Zoom ZM and Digital turbine APPS are top-ranked stocks in the larger IT and tech industry. Both sport a Zacks Rank # 1 (strong buy) You can see the full list of today’s Zacks # 1 Rank stocks here.
Zoom and Digital Turbine’s long-term profit growth rate is set at 15.6% and 50%, respectively.
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