Liftoff Mobile (LFTO) may see share gains in the in-app ad market due to its non-gaming leadership and strong technology, Morgan Stanley said Monday in a note to clients.
The company has a path to revenue growth and continued margin expansion, the investment firm, adding, however that its valuation is already fair and investors should wait for a better entry point.
Morgan Stanley said it sees Liftoff's revenue growing at an about 20% compound annual growth rate through 2027 backed by a mix of "model improvements, continued expansion outside of gaming,
and market growth."
Also, while mobile gaming is still an important part of Liftoff's business, over 50% of the company's ad revenue now comes from non-gaming verticals like finance, commerce, entertainment, and others, the investment firm said.
Morgan Stanley also noted Liftoff is operating inside a $79 billion independent in-app advertising market, which is under-monetized when compared with other advertising channels.
Morgan Stanley initiated Liftoff with an equal-weight rating and $30 price target.
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