5 Reasons Demand Media Is Worth Way More Than The Market Thinks

demand media

Hillside Partners analyst Rory Maher just initiated Demand Media coverage, labelling it a buy with an $11 price target. (The stock currently trades around $7.)

In a note, he gave five reasons to be bullish:

  • “We believe the 70% decline in DMD shares over the past 6-7 months prices in Google Panda impact and see upside to current valuation as better monetization drives long-term growth.”
  • “Demand is just starting to focus on one of its largest and most under-monetized properties Cracked, representing growth opportunities as ad rates and sellout improve.”
  • “We believe modest increases in video content and inventory on Demand’s O&O properties and YouTube channels should drive revenue growth as demand for video inventory remains high.”
  • “Upside at Cracked and YouTube should be able to drive consolidated revenue and profit growth even as eHow and network become smaller revenue drivers.”
  • “Registrar generates recurring revenue and stable profits while Company grows its Content/media businesses.”

Maher also covers Google and a bunch of small caps. More info here (.PDF) >>

NOW WATCH: Tech Insider videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.