USA - This ad-tech stock opened 70% up on Monday: this is why
Taboola.com Ltd ( NASDAQ: TBLA ) opened more than 70% up this morning after Yahoo announced an exclusive 30-year agreement with the advertising company.
What’s in it for Taboola.com Ltd?
On Monday, Yahoo said the Nasdaq-listed firm will power “native advertising” across all of its digital platforms moving forward.
Taboola expects the partnership to be accretive to its revenue, EBITDA, and free cash flow. According to Adam Singolda – the Chief Executive of Taboola.com Ltd:
This win-win partnership will meaningfully accelerate our growth flywheel, expanding our reach to more users on the open web with high-intent traffic to provide world-class solutions in a cookie-less world.
The advertising technology company expects the agreement to help boost its revenue (ex-TAC) to $1.0 billion by 2025. It is also noteworthy that Wall Street continues to recommend buying Taboola shares and sees another 40% upside in it from here.
Yahoo to get 25% of outstanding Taboola shares
Under the terms of this agreement, Yahoo will also get a 25% stake in Taboola.com Ltd. Becoming its largest shareholder, Yahoo will have the right to name one director to its board as well. In a statement, Jim Lanzone – the Chief Executive of Yahoo said:
Together with Taboola, we’ll maximise reach and campaign performance for advertisers, enhance monetisation opportunities for publishers, and drive improved, privacy-forward experiences for users.
Taboola will seek approval from its shareholders on December 30 th – following which, the deal will be finalised by March of 2023.
The announcement brought a much-needed relief for Taboola shares that are under immense pressure this year as advertisers continue to cut their budgets on fears of a looming recession .
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