- Stephens & Co. analyst Nicholas Zangler maintained LiveRamp Holdings Inc (NYSE:RAMP) with an Overweight and lowered the price target from $67 to $58 (126% upside) post Q4 FY22 results.
- While performance was solid, the near-term outlook calling for +17% revenue growth in 1Q23 and +15% to +18% for full-year F23 is likely to disappoint investors looking for a return to +25% revenue growth.
- Positively, RAMP suggests the weak revenue outlook is self-inflicted as an understaffed sales team muted the bookings growth (a leading indicator of revenues).
- Taking corrective measures, the Company has increased sales team capacity by +25% in the last three months and expects revenue growth to improve in the back half of the year.
- Zangler was encouraged by the ongoing Safe Haven expansion, now accounting for 25% of annualized recurring revenue.
- RAMP also announced the intention to repurchase $150 million in stock (10% of the market cap) by December 2022.
- Price Action: RAMP shares traded higher by 10.5% at $25.42 on the last check Wednesday.
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