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Citizens JMP analyst Nicholas Jones downgraded Angi Inc (NASDAQ:ANGI) from Market Outperform to Market Perform on Monday. The downgrade comes as the firm sees intensifying competition among digital home improvement and maintenance marketplaces, despite Angi’s ongoing strategic changes. According to InvestingPro data, Angi currently appears undervalued, maintaining impressive gross profit margins of nearly 95% despite market challenges.
Angi is implementing several strategic shifts in its marketplace, including transitioning from auto matching to homeowner choice, migrating to a single pro product, and improving overall marketplace quality through better matching. These changes align with the company’s "Jobs Done Well" key performance indicator, which reflects marketplace health. InvestingPro analysis shows the company maintains a healthy financial position with a current ratio of 2.15, indicating strong ability to meet short-term obligations.
The strategic adjustments are creating short-term financial headwinds for Angi, though the company views them as necessary long-term decisions. Early positive results include improved homeowner Net Promoter Scores, higher professional win rates, enhanced professional retention, and greater go-to-market efficiency.
Despite these improvements, Citizens JMP expressed concern about growing competition in the digital home services sector. The firm specifically noted that Thumbtack has gained a significant share of monthly active users at the app level over recent years.
The downgrade reflects Citizens JMP’s assessment that while Angi’s strategic changes may improve core fundamentals, the competitive landscape presents challenges that warrant a more cautious rating on the stock.
In other recent news, ANGI Homeservices reported a strong performance for the first quarter of 2025, with earnings per share reaching $0.30, significantly surpassing the anticipated loss. The company also exceeded revenue expectations, reporting $245.9 million against a forecast of $241.64 million. Goldman Sachs analyst Eric Sheridan raised the firm’s price target for ANGI Homeservices to $27, acknowledging the company’s better-than-expected adjusted EBITDA margins and confirming its forecast of declining revenues for the full year of 2025. KeyBanc analysts maintained an Overweight rating on ANGI stock with a price target of $19, following the company’s first-quarter results showing revenue of $246 million, surpassing both their and the Street’s estimates. Despite macroeconomic challenges, ANGI Homeservices remains optimistic about maintaining strong incremental margins and plans to increase marketing spend, balanced by enhanced product and sales efficiency. The company’s strategic initiatives, such as "Homeowner Choice" and AI integration, are highlighted as key growth drivers, with an anticipated return to profitable revenue growth in 2026. ANGI Homeservices’ recent developments reflect a focus on improving business fundamentals and enhancing homeowner satisfaction, positioning the company for sustained growth.
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