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Outbrain - AI Stock Analysis

Analysis generated November 30, 2024

Outbrain Inc. is a leading content discovery platform dedicated to helping users discover content that’s interesting and relevant to them. The company's patented technology helps to show relevant content on multiple platforms and devices, engaging users across the globe. Outbrain operates in a rapidly evolving digital marketing landscape, where it faces competition from a range of both small and large players, including Taboola and Google.

Fundamental Analysis

For the last quarter, Outbrain reported revenue of $224 million. This marks a 4.68% increase compared to the quarter before, demonstrating some growth momentum. However, this revenue figure represents a 2.54% decrease compared to the same quarter last year, which may be a cause for concern for long-term growth prospects.

Net income for the last quarter was $6.7 million, a significant increase of 404.50% compared to the quarter before. Even more impressive is the year-over-year increase of 1,218.11%, suggesting strong profit growth and better cost management.

EBITDA for the last quarter was $2.1 million, representing a 27.17% increase compared to the quarter before. Yet, when compared to the same period last year, this figure shows a substantial decrease of 162.04%, which may indicate challenges with operating efficiency or higher operating costs.

Technical Analysis

As of today, Outbrain’s stock is priced at $5.43, which is a remarkable 24.26% increase compared to a month ago. Compared to a year ago, the stock has appreciated by 37.12%, suggesting a positive long-term trend and overall bullish sentiment.

The current Simple Moving Average (SMA10) is $5.26, up from $5.22 previously. This indicates a continued upward trend in the stock's price movement. However, the Relative Strength Index (RSI) sits at 77.9, which suggests that the stock may be in an overbought condition, possibly hinting at the risk of a pullback.

Alternative Data Analysis

Outbrain presently has 16 open positions according to popular job boards, representing a 48% decrease in the last couple of months. This could indicate that the company is trying to improve its margins or cut costs, which might suggest financial caution or constraints. Employee sentiment remains neutral, suggesting neither strong positivity nor negativity within the workforce.

Regarding customer acquisition, Outbrain has an estimated 224 million visitors to their webpage. This visitor number has declined by 19% in the last couple of months, which is a concerning sign as it may point to a loss in customer engagement and interest.

On the customer engagement front, Outbrain's Instagram platform has 7,700 followers with no meaningful change recently, and their Twitter page has 20,000 followers, down by 1% in recent months. This indicates a potential decrease in interest and engagement on social media.

Furthermore, the AltIndex AI score for Outbrain stands at 54, suggesting a 'hold' signal. This score is derived from comprehensive analyses of fundamental, technical, and alternative data.

Conclusion and Recommendation

Outbrain showcases a mix of promising and concerning aspects in its stock analysis. The company’s strong revenue growth in the short term and substantial improvement in net income are positive indicators. Yet, the decline in year-over-year revenue, sharp dip in EBITDA compared to the previous year, and decrease in customer engagement and job openings could signify potential challenges.

Technical analysis points to a bullish trend, with the stock price showing strong upward momentum. Nevertheless, an RSI indicating an overbought condition calls for caution.

Alternative data adds another layer of complexity, with mixed signals from job postings, employee sentiment, and social media engagement. The AltIndex AI score indicates a 'hold' recommendation.

Overall, given the current mix of positive short-term trends alongside some long-term concerns, a cautious outlook would be reasonable. Investors might consider holding their positions while closely monitoring Outbrain's financials and market indicators for further developments.

Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.