Adware technology provider actions Double Check (NYSE: DV) climbed 14% this week, according to data provided by S&P Global Market Intelligence. The company debuted on the stock exchange earlier in the year and the stock has been volatile since the IPO. Nonetheless, DoubleVerify has recently resumed its trend since reporting a new partnership with TikTok in late September. The partnership will help measure the visibility of videos and eliminate invalid traffic for advertisers.
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In fact, after the social media leader Break‘s (NYSE: SNAP) disappointing profits from last week imputed Apple‘s (NASDAQ: AAPL) new user privacy rules, other actions that rely heavily on digital advertising have fallen in sympathy. Caught in pain were the king of social media Facebook, as well as ad market software publishers The commercial counter, Magnite, and PubMatic. This is not the case with DoubleVerify.
Data by YCharts.
DoubleVerify occupies a unique place in the digital advertising ecosystem. Its software helps marketers, advertising marketplace operators and publishers get the most out of their campaigns. The DoubleVerify Toolkit contains solutions for quality audience targeting, fraud detection and prevention, and improving ad performance (by getting more engagement from ad viewers). Since its software caters to all stakeholders in the industry, from ad seller to buyer, it is set to grow as the entire digital ad space grows.
In fact, DoubleVerify made a new product announcement the same day Snap said Apple’s elimination of user activity tracking impacted its latest quarterly financial results. Called Custom Contextual Targeting for DV Publisher Suite, this tool helps publishers align content with marketer demand without compromising user identity or privacy. In an age when Internet companies are required to be slower and less loose with customer data, this type of product could generate new demand for DoubleVerify’s suite of services.
Since its debut in public commerce, DoubleVerify stock has failed to maintain any positive traction. The company itself is doing more than good, however. Revenue grew 44% year-over-year in the second quarter of 2021, the company has positive free cash flow and management said it expects a 34% year-over-year increase. ‘other at the midpoint of the forecast provided for the third quarter. These third quarter results will be announced on November 9.
With 22 and 108 times 12-month sales and free cash flow, respectively, this is certainly not a valuable security. Nonetheless, DoubleVerify is an intriguing software provider for the digital advertising industry – and it’s worth a look if you’re a long-term (think five years or more) investor in this corner of the tech industry.
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Randi Zuckerberg, former director of market development and spokesperson for Facebook and sister of its CEO, Mark Zuckerberg, is a member of the board of directors of The Motley Fool. Nicholas Rossolillo and his clients own shares of Apple, Facebook, Magnite, Inc, PubMatic, Inc. and The Trade Desk. The Motley Fool owns stock and recommends Apple, Facebook, Magnite, Inc, PubMatic, Inc. and The Trade Desk. The Motley Fool recommends the following options: March 2023 long calls at $ 120 on Apple and March 2023 short calls at $ 130 on Apple. The Motley Fool has a disclosure policy.
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