IAC - IAC: Could Be An Inflection Point With OpenAI Deal Inked

2024-07-05 09:00:00 ET

Summary

• IAC is undergoing major cost control and restructuring efforts, with a focus on improving profitability across all businesses, including Angi and DDM.
• Moreover, they have inked a deal with OpenAI who will pay them for the license to their content, which will translate at high margin into profits.
• We have reduced the P/S on DDM for conservativeness compared to last article, but the upside is just growing further as IAC reaches close to all-time lows.
• We are sounding a buy alert, and would buy ourselves if only cash were available.

IAC ( IAC ) shares its earnings call space with the management of one its largest holding Angi ( ANGI ) as well, which is a directory platform that earns some advertising revenue as well as lead revenue from connecting clients with workers carrying out home improvement services and is also publicly listed. Naturally, much of IAC is also not Angi. There is Dotdash Meredith or DDM which is their portfolio of digital and print magazines/publications where they also primarily sell advertising but also subscriptions at around 20% of the business' overall revenue....

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