Based on its valuation and growth profile, Marin Software — a provider of a cloud-based digital advertising management platform — could be an attractive buyout target for a larger player in the online marketing space.
At the recent market cap of $373 million, Marin’s forward revenue multiple of 3.9 times the 2014 consensus estimate of $95.8 million (within the company’s guidance range of $95 million to $96.6 million) is reasonable given expected growth of nearly 24 percent.
Marin is a so-called busted IPO because the shares trade below the March 2013 offering price of $14. In fact, Marin shares have been on a downward trek ever since the first trading session: they opened at $18.95 and hit a post-IPO high of $19.95 on the same day. While the stock has recovered a bit from the November low of $8.50, it’s still 18 percent short of the IPO price.
Measuring Ad Spend
Advertisers are increasingly focused on performance-based marketing, so they’re always looking for ways to pull together and analyze data about the effectiveness of digital ads in order to run more targeted and impactful campaigns. Marin’s Revenue Acquisition Management (RAM) platform is used by advertisers and ad agencies to measure, manage and optimize digital ad spending across search, display, social and mobile channels.
Using the RAM platform, customers can measure the effectiveness of their ad campaigns via its reporting and analytics capabilities; manage and execute campaigns (including ad creation and bidding across multiple publishers and channels); and optimize campaigns in real-time based on market and business data to achieve desired revenue outcomes using predictive bid management technology.
Marin’s platform integrates with leading publishers (Google, Facebook, Yahoo, Bing and Baidu), web analytics offerings, ad-serving solutions and key enterprise applications. It basically acts like a system-of-record for ad performance, revenue and conversion data; it enables advertisers to correlate spending to subsequent revenue outcomes and business events.
Using a single interface that handles the daily workflow requirements of online marketers, customers can simultaneously run large-scale digital ad campaigns across multiple publishers and channels. This makes it easy for marketers to create, publish, modify and optimize campaigns on the fly.
Marin’s predictive bid management and optimization technology also allows advertisers to forecast outcomes, as well as rapidly shift more dollars into campaigns, publishers and channels that are performing well.