MNTN (NYSE:MNTN) Releases Earnings Results, Misses Estimates By $0.10 EPS

MNTN (NYSE:MNTN) posted its quarterly earnings results on Wednesday. The company reported $0.10 earnings per share for the quarter, missing analysts’ consensus estimates of $0.20 by ($0.10), Zacks reports. MNTN had a return on equity of 18.85% and a net margin of 18.00%. The company had revenue of $80.25 million for the quarter, compared to analysts’ expectations of $87.77 million. During the same period in the prior year, the business earned $0.08 EPS. The business’s revenue for the quarter was up 14.6% on a year-over-year basis.

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 Down 54.7%

Shares of NYSE:MNTN traded down $5.67 during trading on Thursday, hitting $4.70. 7,045,266 shares of the company were exchanged, compared to its average volume of 952,865. MNTN has a 1-year low of $4.66 and a 1-year high of $14.89. The company has a market capitalization of $290.59 million, a P/E ratio of 6.60 and a beta of 1.17. The business’s 50 day moving average is $10.87 and its 200-day moving average is $9.97.

Analysts Set New Price Targets

MNTN has been the subject of a number of recent analyst reports. Raymond James Financial lowered MNTN from an “outperform” rating to a “market perform” rating in a report on Thursday. Susquehanna reduced their target price on MNTN from $20.00 to $12.00 and set a “positive” rating for the company in a report on Thursday. Evercore cut shares of MNTN from an “outperform” rating to an “in-line” rating and set a $7.00 target price for the company. in a research note on Thursday. Weiss Ratings raised MNTN from a “sell (d)” rating to a “sell (d+)” rating in a report on Wednesday, August 19th. Finally, Freedom Broker began coverage on MNTN in a research report on Tuesday. They set a “buy” rating and a $16.50 target price for the company. One analyst has rated the stock with a Strong Buy rating, four have issued a Buy rating, six have issued a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat, the company presently has an average rating of “Hold” and a consensus price target of $15.30.

MNTN News Summary

Here are the key news stories impacting MNTN this week:

• Neutral Sentiment: Susquehanna cut its price target to $12 from $20 but maintained a positive rating, signaling that the analyst sees potential upside while marking down expectations. Susquehanna rating
• Negative Sentiment: MNTN reported third-quarter adjusted EPS of $0.10 and revenue of $80.25 million, both below analyst expectations. Revenue still grew 14.6% year over year, but the company’s reduced financial outlook and sales-force disruption overshadowed that growth. MarketWatch report
• Negative Sentiment: Analysts lowered ratings: Evercore moved MNTN from “outperform” to “in-line” with a $7 target, while Citizens JMP and Raymond James also downgraded the stock. These moves reflect diminished confidence following the results and outlook. Evercore rating Raymond James rating
• Negative Sentiment: Two law firms announced investigations into potential securities claims, focusing on whether MNTN adequately disclosed the effects of sales-organization changes on customer acquisition and revenue growth. The investigations are allegations, not findings, but add uncertainty for investors. Johnson Fistel investigation announcement

Insider Activity at MNTN

In related news, major shareholder Baroda Ventures Llc sold 275,115 shares of the stock in a transaction on Tuesday, August 18th. The shares were sold at an average price of $12.75, for a total transaction of $3,507,716.25. Following the transaction, the insider directly owned 6,375,543 shares of the company’s stock, valued at $81,288,173.25. This represents a 4.14% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. In the last 90 days, insiders sold 335,555 shares of company stock worth $4,266,038. 19.60% of the stock is owned by corporate insiders.

About MNTN

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.