Goldman Sachs analysts initiated coverage of Ibotta (IBTA) with a Neutral rating and a 12-month price target of $103, saying they see the stock “positively benefiting from a number of long-term secular growth themes within our sector in both countries.” Digital and grocery advertising.
“In the current market environment, we see discussions around the overall macroeconomic impact on digital advertising, the pace/cadence of loyal 3P additions and the impact of the Walmart partnership as the largest potential drivers of upside/downside volatility next year,” the analysts wrote.
At the same time, JMP Securities analysts also assumed coverage on IBTA, with a market outperform rating and a price target of $130. The investment firm believes the technology company is transforming the consumer packaged goods merchandising industry through the Ibotta Performance Network.
Their positive outlook is driven by Ibotta's growing reach, which includes more than 2,400 consumer packaged goods brands, 850 retail partners, and engagement with more than 200 million consumers. They believe that increasing consumer reach will attract more brands, boost coverage, and attract more merchants.
“With high unit economics and an approximately $200 billion opportunity within the consumer packaged goods category, we believe Ibotta can generate significant free cash flow to shareholders,” the JMP team noted.
Analysts at Citi Research have also initiated coverage of IBTA, rating it a buy and setting a price target of $120.
The Wall Street firm views the company as a leader in digital promotions with 4x the digital promotions of its closest competitor and 7x the ROAS of its CPG partners, and believes it is well-positioned for further growth as it expands its retail networks and brand capabilities. Bigger business. breakthrough.
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“To be clear, it's still early in the Ibotta Performance Network (IPN) and hybrid transition from Ibotta's core D2C app, but with Walmart now fully operational and new retailers joining, we believe it's likely that more brands will “To join the platform given Ibotta’s growing scale and reach (over 200 million consumers),” Citi analysts said.
“Broadly, we believe Ibotta can deliver EBITDA margins in excess of 50%, and we believe there is likely to be upside to the outlook as the Ibotta network expands,” they added.
IBTA shares rose more than 2% on Monday.