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On Tuesday, Benchmark analysts revised their price target for Getty Images Holdings Inc. (NYSE: GETY), lowering it from $4.50 to $3.50, while maintaining a Buy rating on the stock. Currently trading at $1.76, InvestingPro analysis suggests the stock is slightly undervalued, despite falling 38% over the past six months. The adjustment followed Getty Images’ first-quarter performance, which was impacted by slightly weaker demand, especially in the Agency sector, amid broader economic pressures.
Getty Images has reaffirmed its expectation for constant currency revenue growth for the year 2025, with the growth anticipated to be driven by its Corporate and Media segments. The company maintains a robust gross margin of 73%, though InvestingPro data reveals some near-term liquidity challenges with a current ratio of 0.72. Despite the stock’s underperformance ahead of its upcoming merger with Shutterstock (NYSE:SSTK) and concerns over the potential dilutive effects of generative AI models on Getty’s exclusive content value, Benchmark remains optimistic about the stock’s prospects.
The firm’s confidence in maintaining a Buy rating is based on two key factors. First, there is an expected realization of cost and revenue synergies post-merger with Shutterstock. Second, Getty Images’ data licensing business is seen as a vital financial mechanism to counter the challenges posed by generative AI technologies and the protracted legal proceedings with Stability AI. While currently unprofitable, analysts tracked by InvestingPro expect the company to turn profitable this year, with several additional ProTips available for subscribers regarding the company’s financial health and growth prospects.
Benchmark’s analysis indicates that while Getty Images faces challenges, including the pending merger and evolving industry dynamics, the company’s strategic moves and business practices are still poised to support its growth. The analyst’s comments suggest that Getty Images’ core strengths and potential synergies from the Shutterstock merger could offset the current headwinds facing the company. For a deeper understanding of Getty Images’ potential, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro, which provides detailed analysis of the company’s financials, market position, and growth prospects.
In other recent news, Getty Images Holdings Inc. reported its financial results for the first quarter of 2025, revealing a revenue of $224.1 million, which represents a 0.8% increase year-over-year. However, this figure fell short of the company’s forecasted revenue of $236.17 million. The subscription revenue, a key focus for Getty Images, grew by 5.4% and now accounts for 57.2% of the total revenue. Adjusted EBITDA for the quarter was $70.1 million, slightly down by 0.1% but up 2.2% on a currency-neutral basis.
Citi analyst Ronald Josey adjusted the price target for Getty Images to $2.05 from $2.45, maintaining a Neutral rating on the stock. The company’s gross margins improved slightly to 73.1%, but faced challenges such as the Los Angeles Fires and ongoing Hollywood strikes impacting revenue. Despite these hurdles, the company is focusing on expanding its subscription base, with 53% of the last twelve months’ active subscribers being new. Additionally, Getty Images is enhancing its AI capabilities, although adoption remains in early stages. The proposed merger with Shutterstock is under regulatory review, with Getty Images incurring $8 million in compliance costs related to Sarbanes-Oxley Act requirements.
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