Through thick and thin, no matter what the circumstances of the outside world may be, investors can depend on at least one thing as an absolute certainty: There’s a whole lot of data out there, and it’s only going to continue to increase with each passing day.
Every interaction products more data: phone calls, text messages, and emails as well as all the data that businesses collect, create, and distribute. And then there’s the data it takes in order to access all that data.
Needless to say, there’s essentially a never-ending data stream that flows through almost each and every person’s daily life. As such, there’s quite a bit of money to be made in the data industry. LiveRamp (RAMP) is one such company.
But is it worth investing in? Let’s look at the facts.
LiveRamp Enables Businesses To Make Sense of Data
While it’s known that LiveRamp (RAMP) is involved in the data industry, the full extent of what LiveRamp does encapsulates a lot more than simply handling data.
It was formerly known as Acxiom Corporation back when they were founded in 1969, but as technology changed, so did its name. In short, it is now a SaaS company, which stands for “software as a service.” It’s a term that might sound unfamiliar to the average Joe, but it’s easily a billion dollar industry that provides companies and individuals with subscription-based access to key business and financial software.
It specializes in being a platform for data connectivity, prioritizing things like data onboarding and transferring data from offline to online so that it can be used for marketing.
The full spread of its products and services includes Authenticated Traffic Solutions (ATS), a Data Marketplace, a Privacy Manager, and a slew of other marketing and data tools that help companies take control of their data to better the customer experience.
In other words, LiveRamp is a haven for a company’s data, providing them with the tools they need to sort, interpret, and act upon the data and information they’ve gathered.
LiveRamp Revenues and Earnings Forecasts
Over the past several years, LiveRamp’s revenues have continued to increase steadily and consistently. Just in the past three years alone, LiveRamp has managed to nearly double their quarterly revenue from about $55 million to $120 million.
However, despite this positive development in recent years, LiveRamp’s big picture looks a lot more concerning: In 2006, it was pulling in over $350 million a quarter. Compare that to its recent peak of $120 million, and it suddenly looks a lot more paltry than it did just a couple of sentences ago.
While LiveRamp is projected to continue to climb upwards, there’s no telling how long it will take the company to reach the numbers it was bringing in about 15 years ago. With its quarterly growth gradually shrinking with each passing quarter since March of 2020, it very well could be another 15 years until then.
If LiveRamp continues to follow the path it’s been on for the past several quarters, then it faces the possibility of entering a negative growth phase. It’s in need of a jump start, and fast.
LiveRamp Share Price Paints Gloomy Picture
While LiveRamp looks like a good bet up close on a stock chart, it looks much less compelling when zooming out and viewing its price per share over the past year or so.
The company hit a high of nearly $87 per share back in January of 2021, and it has since dropped to just under $42 per share. This is a decrease of more than half, and while its revenues have been gradually increasing, the company’s share price doesn’t show any signs of following suit.
To make matters even worse technically, LiveRamp has just recently entered into oversold territory, meaning that bearish momentum is strong. Just how much that fall will be remains to be seen, but retail investors and traders can all but depend on an upcoming dip of some sort for LiveRamp.
These sorts of rises and falls are going to happen with any stock on the market, even the most dependable ones, but LiveRamp stock has proven to be anything but dependable over the past twelve months or so: it’s gone from $44 per share to $87 per share and back down to $42 per share (and dropping). That’s a tell-tale sign of a volatile and risky investment.
Is LiveRamp Valuation Fair?
While LiveRamp’s price per share might be reaching some record lows for the company as of late, many analysts seem to believe that the company is headed for a dramatic turnaround. The lowest forecasts have hovered around the $60 mark, while the best case scenario seems to be a prediction on the high end of $93 per share.
Its decreased valuation seems more than fair today, but there’s no telling what kind of activity (whether positive or negative) is in store for LiveRamp’s future on the stock market.
If analysts’ consensus estimates are right, the upside potential for RAMP share price sits at $73 per share.
Is LiveRamp Stock A Buy? The Bottom Line
While LiveRamp certainly seems to be showing signs of a potential rise in the near future, they are currently showing that they aren’t done dipping yet. For this reason, LiveRamp is not a buy right now. That’s not to say it isn’t worth watching, though — If LiveRamp performs as well as it’s predicted to do in the near future, then retail investors and traders will want to get in right around that uptick. This will be tricky to pinpoint, though, because the stock seems to be in a constant state of mini-rises and mini-dips. Keep an eye out for this one, but for now, it’s better to not buy.
The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.