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On Thursday, Citizens JMP revised its price target for Nexxen (NASDAQ: NEXN) shares, raising it to $15.00 from the previous $11.00, and reaffirmed its Market Outperform rating. The adjustment follows Nexxen’s announcement of robust first-quarter results for 2025, which saw the company’s contribution excluding Traffic Acquisition Costs (ex-TAC) surpass consensus estimates by approximately 2%, and its EBITDA outperforming by about $8 million. According to InvestingPro data, Nexxen maintains impressive financial health with a "GREAT" overall score and strong fundamentals, including an exceptional 83.3% gross profit margin and solid 10.09% revenue growth over the last twelve months.
Nexxen’s financial performance for the first quarter exceeded expectations. However, despite this positive outcome, the company has chosen to maintain its full-year 2025 guidance for both contribution ex-TAC and EBITDA. This decision was influenced by a perceived softness in the advertising market that emerged in April after tariff announcements were made. Nexxen attributed this market softness to delays in advertising campaigns rather than reductions in advertising budgets. The company anticipates that the delayed spending will resume in the second half of the year. InvestingPro analysis reveals the company holds more cash than debt on its balance sheet and maintains a healthy current ratio of 1.44, suggesting strong financial flexibility to navigate market fluctuations.
The company’s stance is that the current weakness is a result of campaign postponements and not cuts to advertising budgets. Nexxen is expecting the postponed ad spending to be reallocated to the latter half of 2025. Consequently, the company is holding off on altering its guidance until it can better gauge the advertising market’s trajectory for the remainder of the year. For deeper insights into Nexxen’s market position and comprehensive financial analysis, investors can access the detailed Pro Research Report available on InvestingPro, which includes 15+ additional ProTips and extensive financial metrics.
Citizens JMP’s revised price target suggests confidence in Nexxen’s ability to navigate the current market environment and capitalize on the expected rebound in advertising spending in the second half of the year. The firm’s analysis indicates that Nexxen’s current strategies and financial health position it well for future growth, despite the temporary challenges in the advertising sector.
The announcement from Citizens JMP comes as Nexxen continues to monitor the evolving conditions in the global advertising market, with a focus on adapting its strategies to maintain its growth trajectory and meet its financial targets for the year.
In other recent news, Nexxen International Ltd. reported first-quarter results that exceeded expectations, driven by a significant increase in connected TV (CTV) revenue. The company posted adjusted earnings per share of $0.16, surpassing analyst estimates of $0.07. Revenue for the quarter reached $78.33 million, outpacing the consensus forecast of $73.2 million and marking a 5% year-over-year increase. CTV revenue saw a 40% year-over-year jump to $26.4 million, now accounting for 37% of the company’s programmatic revenue. Overall programmatic revenue grew by 10% to $71.8 million. Nexxen’s adjusted EBITDA nearly doubled to $23.1 million, with the adjusted EBITDA margin expanding to 31% from 17% a year ago. The company reaffirmed its full-year 2025 guidance, projecting contribution ex-TAC of approximately $380 million and adjusted EBITDA of about $125 million. Despite some softness in Q2 advertising due to economic uncertainty, Nexxen remains confident in its full-year outlook. Additionally, the company completed a $50 million share repurchase program and initiated a new $50 million buyback initiative in April.
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