DRCT - Direct Digital Holdings (DRCT) - Finding A Gem In The Ad Tech Rubble

Initiating coverage with Outperform rating. We believe that Digital Direct has dynamic growth opportunities in a large and fast growing market for programmatic advertising. Its target advertisers include small to medium size businesses interested in multicultural and under served target audiences, as well as a broad reach, which differentiates the company from many of its peers. Compelling growth industry. Direct Digital's sell-side, programmatic advertising platform, called Colossus, is the key growth driver for the company and plays in a large, dynamic growth market. The global programmatic advertising market is expected to grow at 12% CAGR from 2021 through 2026, from $418 billion to $725 billion. Based on our estimates, the company is expected to generate $28.2 million in revenue in 2022 in this segment, illustrating the significant headroom for growth. Read More >>