Why Is LiveRamp (RAMP) Stock Rocketing Higher Today

Petr Huřťák /
2023/11/09 11:40 am EST

What Happened:

Shares of advertising data platform LiveRamp (NYSE:RAMP) jumped 14.3% in the morning session after the company reported third-quarter results that beat on key line items like revenue, adjusted operating profit, and adjusted EPS. We were also impressed by LiveRamp's strong gross margin improvement this quarter and its increase in net revenue retention. The company cited a stronger-than-expected digital advertising market and a stable selling environment as tailwinds. This is despite some companies saying that the digital advertising backdrop is a bit shaky due to macro and geopolitical uncertainty. The major positive is that guidance was strong and full year guidance, in particular, was raised across the board. On the other hand, direct subscription customers (a number that decreased year on year) fell below expectations, and the company continued to observe an average deal cycle that remained about a quarter longer than the levels observed in the previous year. Zooming out, we think this was a great quarter, showing that the company is staying on track.

Is now the time to buy LiveRamp? Access our full analysis report here, it's free.

What is the market telling us:

LiveRamp's shares are quite volatile and over the last year have had 12 moves greater than 5%. But moves this big are very rare even for LiveRamp and that is indicating to us that this news had a significant impact on the market's perception of the business. 

The biggest move we wrote about over the last year was 3 months ago, when the stock gained 8.9% on the news that the company reported a "beat and raise" quarter. Second quarter revenue came in ahead of Wall Street's expectations, driven by outperformance in its marketplace segment, which benefitted from a "stronger-than-expected digital advertising environment." Profitability metrics also came in strong as LiveRamp recorded a rare quarter of positive GAAP operating income. Earnings per share also beat. On the other hand, customer growth slowed. Looking ahead, full-year revenue guidance came in higher than Wall Street's estimates and was lifted. Overall, it was a stronger quarter for the company.

LiveRamp is up 53.3% since the beginning of the year. Investors who bought $1,000 worth of LiveRamp's shares 5 years ago would now be looking at an investment worth $773.42.

Do you want to know what moves the stocks you care about? Add them to your StockStory watchlist and every time a stock we cover moves more than 5%, we provide you with a timely explanation straight to your inbox. It's free and will only take you a second.