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PubMatic (PUBM) Another potential Multibagger!? Time to buy for NASDAQ:PUBM by foxbelex

(1) Fundamentals:
Pubmatic Inc . ( PUBM ) provides a cloud infrastructure platform that enables real-time programmatic advertising for internet content creators and advertisers worldwide. It operates as SSP (Supply-Side Platform). One of its main competitors is Magnite , which right now is probably the biggest SSP Player in this space ( TTD works as DSP).
Nevertheless PUBM has a fundamentally stronger stance than Magnite , because it already generates real profits on the bottom line and at the same time has been constantly overdelivering (and raising guidance) in regards of Revenue Growth (over 30% YoY) with Gross Profit Margins of over 73%. Being valued at a forward EV /Sales of 8 this stock is really a bargain with an incredible valuation potential considering that this space has a huge TAM that is growing at a yearly 10 – 20% pace.
Biggest risk (and chance at the same time) is its high short interest rate of around 30% (nobody really knows if this figure is correct and if so, why it is so high).

(2)Technicals:

Looking at the daily Chart we see two clear signals. First an increase in Volume (this is important) and at the same time a nice CUP & HANDLE formation, which is a very bullish pattern . After surpassing the next strong resistance of $38,02 (red line representing the 50 day EMA ) PUBM should be going after it’s remaining resistances at $45, 56 & $62 and then quickly head to it’s intraday ATH of $76,96. I think that it is perfectly possibly, if management continues delivering great quarterly results, that PUBM could become another Multibagger reaching the $100 handle within the next 12 months. In other words, investors and Medium Term Traders that are looking for great returns should be considering the actual level of $34-35 as entry point for a first investment into PUBMATIC .

Those who are willing to take this risk won’t regret it and if you liked this analysis please give the like button a hit and eventually leave a comment.

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