TubeMogul Shares Plummet, But JMP Is Still Bullish

TubeMogul Inc's TUBE was down more than 22 percent at $13.86 on Friday morning, after the company issued weaker-than-expected guidance for the year. The software provider beat expectations on earnings and revenue, but the market appears to be punishing the stock for the sales projection.

In a report published Friday morning, JMP Securities commented on the results: "if $6M in FX headwinds added back in, guidance is not as bad." The firm reiterated its Market Outperform rating, but lowered its price target from $22 to $21 on the weak 2015 guidance, offset by a strong fourth quarter.

The analysts said that, while they "recognize the mixed sentiment around programmatic overall," they continue to see TubeMogul positively "given its focus on video, its self-service enterprise solution, and growing scale of media spend directly from brands."

JMP estimates that FX impacted total guidance by approximately $6 million, which means it would have been in line with consensus. JMP analysts still think that the company "is well positioned to grow its share of the $70B+ domestic TV advertising market as advertisers increasingly follow audiences online."

For 2015, the analysts project spend of $366 million (up 44 percent year-over-year), revenue of $150 million (up 31 percent), gross profit of $108 million (up 34 percent, 72.1 percent margin), EBITDA of ($9.9 million) (-6.6 percent margin) and EPS of ($0.33).