MNTN (NYSE:MNTN) Releases Quarterly Earnings Results

Key Points

• MNTN reported quarterly EPS of $0.10, missing the $0.20 consensus estimate, though revenue grew 14.6% year over year.
• Q3 revenue of $80.3 million and adjusted EBITDA of $19.9 million fell short of expectations; the company lowered full-year revenue guidance to $311–$314 million. Management blamed sales execution challenges after organizational changes led to the loss of about 40% of experienced quota-carrying sellers.
• Existing-customer expansion remained above 115%, and MNTN ended the quarter with $252 million in cash and no borrowings, despite the new-business slowdown.

MNTN (NYSE:MNTN - Get Free Report) announced its quarterly earnings results on Wednesday. The company reported $0.10 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.20 by ($0.10), Zacks reports. MNTN had a net margin of 18.00% and a return on equity of 18.85%. The firm's quarterly revenue was up 14.6% compared to the same quarter last year. During the same quarter in the previous year, the company posted $0.08 earnings per share.

Here are the key takeaways from MNTN's conference call:

• MNTN missed Q3 guidance: revenue was $80.3 million versus $86–$89 million expected, and adjusted EBITDA was $19.9 million versus $22–$25 million. Q4 guidance is $75–$78 million in revenue and $8–$10 million in adjusted EBITDA; full-year revenue guidance was cut to $311–$314 million.
• CEO Tony Weisman attributed the slowdown primarily to sales execution: compensation and organizational changes led to the loss of about 40% of experienced quota-carrying sellers, reducing new-business opportunities. MNTN has changed the plans and hired 16 sellers, but expects the disruption to continue into Q4 while new hires ramp.
• Existing customers continued to spend and expand, with the company’s expansion rate remaining well above 115%; management said the shortfall was concentrated in new customers. MNTN also reported a 79% gross margin and said it continues to win head-to-head pitches at prior rates.
• Despite the revenue shortfall, Q3 revenue grew 15% year over year and adjusted EBITDA rose 24% to $19.9 million, with a 24.8% margin. MNTN ended the quarter with $252 million in cash and no borrowings.

MNTN Stock Performance

NYSE MNTN traded up $0.67 during mid-day trading on Wednesday, reaching $10.40. 1,341,520 shares of the stock were exchanged, compared to its average volume of 598,167. MNTN has a 1-year low of $7.67 and a 1-year high of $14.98. The business's fifty day simple moving average is $10.87 and its 200 day simple moving average is $9.97. The stock has a market capitalization of $643.90 million, a PE ratio of 13.33 and a beta of 1.17.

Wall Street Analysts Forecast Growth

A number of equities research analysts recently issued reports on the company. Freedom Broker started coverage on MNTN in a research note on Tuesday. They issued a "buy" rating and a $16.50 target price on the stock. Wall Street Zen raised MNTN from a "hold" rating to a "buy" rating in a research report on Monday, September 28th. Evercore set a $22.00 price target on MNTN in a report on Wednesday, August 5th. Morgan Stanley set a $16.00 price objective on MNTN in a research report on Monday, August 10th. Finally, Weiss Ratings raised MNTN from a "sell (d)" rating to a "sell (d+)" rating in a research note on Wednesday, August 19th. One research analyst has rated the stock with a Strong Buy rating, nine have given a Buy rating, two have assigned a Hold rating and one has issued a Sell rating to the company's stock. According to data from MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and an average target price of $18.45.

Insider Buying and Selling

In other MNTN news, major shareholder Baroda Ventures Llc sold 275,115 shares of the business's stock in a transaction on Tuesday, August 18th. The stock was sold at an average price of $12.75, for a total value of $3,507,716.25. Following the completion of the transaction, the insider directly owned 6,375,543 shares in the company, valued at approximately $81,288,173.25. The trade was a 4.14% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is accessible through this link. Over the last three months, insiders have sold 335,555 shares of company stock valued at $4,266,038. 19.60% of the stock is currently owned by insiders.

MNTN Company Profile

MNTN, Inc is an advertising technology company that provides software for planning, launching, measuring and optimizing connected television (CTV) advertising campaigns. Its platform is designed to help businesses use television advertising with the targeting, automation and performance measurement capabilities commonly associated with digital marketing.

The company's products support campaign creation, audience targeting, media buying and analytics across streaming television environments.

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