MediaAlpha (MAX) Stock Forecast & Price Target

MediaAlpha Inc. reported a total transaction value of approximately $589 million for Q3, reflecting a year-over-year increase of around 30%, with the property and casualty (P&C) vertical experiencing a sequential growth of 26% and a robust 42% year-over-year growth. The company's adjusted total revenue rose by 18% year-over-year to $306.5 million, with a contribution margin of 7.7% of total transaction value, amounting to $45.6 million, which is a 10% increase year-over-year. Additionally, the positive outlook for customer acquisition spending, bolstered by improved profitability among auto insurance carriers, positions MediaAlpha favorably in a growing addressable market driven by premium rate increases.

MediaAlpha Inc. has reported a significant decline of approximately 40% year-over-year in its Health TV segment, adversely affecting both the under-65 health and Medicare markets. The company has also provided a Q4 revenue forecast of $280-300 million, representing a 3.5% decrease year-over-year at the midpoint and falling short of consensus estimates, which projected around $308 million. Furthermore, sensitivity analysis indicates that earnings estimates are highly volatile, with a mere 10% change leading to a proportional adjustment in price targets, underscoring the instability in the company’s earnings outlook.