Raymond James hosted an online advertising conference call with an industry expert. The expert has visibility into approximately $2 billion in spend with a mix similar to the ad industry and diverse among Fortune 1,000 advertisers.
Raymond James viewed the expert commentary positively, given expectations of a modest deceleration in year-over-year growth rates in 2Q.
2022 budgets have fallen slightly due to the effects of inflation on the consumer, the Ukraine crisis and supply issues. Consequently, the expert expects growth of around 25% in 2022 against 30% initially.
Platforms more exposed to direct advertising should hold up better and be rated Alphabet Inc. GOOG GOOGL Google search saw relatively flat growth rates in Q2.
The expert noted a slight slowdown in Meta Platforms Inc META growth rate in 2Q with a slightly lower return on investment.
Meta is in the best position to improve its targeting/measurement given its scale with the increased traction of Reels.
Snap inc. INSTANTANEOUS growth has slowed slightly, and the expert believes Snap’s revised outlook may be more down to overly optimistic initial forecasts over a significant shift in industry fundamentals.
The expert remained positive on programmatic trends, was bullish on CTV’s growth prospects, and highlighted the TTD and strength of ad verification companies (like Integral Ad Science Holding Corp IAS).
Netflix, Inc. NFLX has the option of becoming a walled garden but will likely have open inventory for its distribution partners.
Following the call, Raymond James remains constructive on the online advertising group. His top picks include Alphabet, Meta, and Integral Ad Science.
Photo via Wikimeid Commons