5 Best Advertising Stocks To Invest In

In this article, we discuss 5 best advertising stocks to invest in. If you want to see more stocks in this selection, check out 11 Best Advertising Stocks To Invest In. 

5. Boston Omaha Corporation (NYSE:BOC)

Number of Hedge Fund Holders: N/A

Boston Omaha Corporation (NYSE:BOC) is headquartered in Omaha, Nebraska, engaged in the outdoor billboard advertising business in the southeast United States. The company also partakes in the surety insurance and related brokerage, broadband, and investment businesses. Boston Omaha Corporation (NYSE:BOC) is one of the best advertising stocks to monitor. 

On November 1, Wells Fargo analyst Steven Cahall raised the price target on Boston Omaha Corporation (NYSE:BOC) to $34 from $27 and maintained an Overweight rating on the shares. The analyst argued that Boston Omaha Corporation (NYSE:BOC) is the best smid-cap stock that investors are not aware of, as he lifted 2022/2023 EBITDA estimates at Billboards and Broadband on the back of resilient organic growth.

According to Insider Monkey’s data, Adam Peterson’s Magnolia Capital Fund held the leading stake in Boston Omaha Corporation (NYSE:BOC) at the end of the second quarter of 2022, comprising 5.7 million shares worth $117.3 million. 

4. Digital Turbine, Inc. (NASDAQ:APPS)

Number of Hedge Fund Holders: 27

Digital Turbine, Inc. (NASDAQ:APPS) is a Texas-based company that operates a mobile growth platform for advertisers, publishers, and device original equipment manufacturers (OEMs). The company operates through three segments – On Device Media, In App Media AdColony, and In App Media Fyber. Digital Turbine, Inc. (NASDAQ:APPS) is one of the best advertising names to monitor. 

On October 5, Digital Turbine, Inc. (NASDAQ:APPS) announced a strategic investment in Aptoide, one of the biggest independent Android app stores, with more than 250 million users. This investment will promote improved app discovery experiences for Digital Turbine, Inc. (NASDAQ:APPS)’s OEM Partners globally. 

Roth Capital analyst Darren Aftahi on October 31 maintained a Buy rating on Digital Turbine, Inc. (NASDAQ:APPS) but lowered the firm’s price target on the shares to $20 from $32, citing headwinds that could limit visibility and broader multiple compression. However, the analyst believes that Digital Turbine, Inc. (NASDAQ:APPS)’s free cash flow yield is “very enticing.” 

According to Insider Monkey’s Q2 data, 27 hedge funds were long Digital Turbine, Inc. (NASDAQ:APPS), compared to 32 funds in the last quarter. Scott Stewart Miller’s Greenhaven Road Investment Management is the largest position holder in the company, with 1.40 million shares worth $24.5 million. 

Here is what Greenhaven Road Capital has to say about Digital Turbine, Inc. (NASDAQ:APPS) in its Q1 2022 investor letter:

“Digital Turbine (NASDAQ:APPS) – Digital Turbine has effectively zero exposure to oil or Ukraine, is well equipped to deal with inflation as all of its inputs and outputs are digital, and should have zero issues with rising rates. Shares got hammered with the decline in “growth stocks” as well as a concern that Google would change its policies on Android device IDs that are used for advertising targeting and attribution (a change that wasn’t put in place but was discussed in a blog post). Given that Digital Turbine has software on devices and is not reliant on the Android device IDs for attribution, it is more likely they would be a beneficiary of this change than a victim. Add in the fact that the European Union is progressing towards a Digital Markets Act that would compel Apple to allow for competing app stores, the regulatory landscape is favorable to Digital Turbine. The decline is exceedingly frustrating.

Our investment in Digital Turbine is predicated on three beliefs. The first is that companies will continue to want direct relationships with their customers via apps. The second is that companies will go to where the eyeballs are, which means mobile phones for the foreseeable future. The third belief is that Digital Turbine can carve out a durable and profitable niche between end users and app developers/carriers/handset manufacturers. All of these beliefs remain in place; nothing has changed. Digital Turbine’s software is installed on over 1.5 billion devices and growing, and they work with more carriers and companies every quarter.

In terms of valuation, management has guided to tripling revenues and 10Xing profits over the next three to five years. Yes, that is a long time and a lot can go wrong, but we are not paying for that level of upside. If you take the last quarter’s run rate earnings, adjusting for one-time expenses related to acquisitions and the amortization of intangibles, you get an adjusted net income of approximately 43 cents per share or $1.72 per share annualized. This is for a core legacy business that grew 43% with large wins for the MobilePosse business and a SingleTap business with a bright future. Unlike many high growth companies, Digital Turbine is profitable while growing and has a PEG ratio below 1.”

3. Omnicom Group Inc. (NYSE:OMC)

Number of Hedge Fund Holders: 29

Omnicom Group Inc. (NYSE:OMC) is one of the best advertising stocks to invest in. It is a New York-based provider of advertising, marketing, customer relationship management, public relations, and corporate communications services. On October 18, Omnicom Group Inc. (NYSE:OMC) reported its Q3 results, posting a Q3 GAAP EPS of $1.77 and a revenue of $3.44 billion, topping market estimates by $0.13 and $100 million, respectively. 

On October 14, JPMorgan analyst David Karnovsky noted that there are attractive risk/reward profiles for advertising agencies heading into the Q3 results. He had an Overweight rating on Omnicom Group Inc. (NYSE:OMC) with a price target of $86. 

Among the hedge funds tracked by Insider Monkey, Omnicom Group Inc. (NYSE:OMC) was part of 29 public stock portfolios at the end of Q2 2022, up from 22 in the prior quarter. Cliff Asness’ AQR Capital Management is the largest position holder in the company, with 651,855 shares worth $40.8 million. 

2. The Interpublic Group of Companies, Inc. (NYSE:IPG)

Number of Hedge Fund Holders: 30

The Interpublic Group of Companies, Inc. (NYSE:IPG) is a New York-based company that provides advertising and marketing services worldwide. The company specializes in consumer advertising, digital marketing, communications planning, media buying, public relations, specialized communications disciplines, and data science services. The Interpublic Group of Companies, Inc. (NYSE:IPG) is one of the premier advertising stocks to invest in.

On October 31, The Interpublic Group of Companies, Inc. (NYSE:IPG) declared a quarterly dividend of $0.29 per share, in line with previous. The dividend is payable on December 15, to shareholders of the company as of December 1. The Interpublic Group of Companies, Inc. (NYSE:IPG) also posted market-beating Q3 results. 

Investment advisory JPMorgan sees attractive risk/reward profiles on the advertising agencies into the Q3 results, and he reiterated an Overweight rating on The Interpublic Group of Companies, Inc. (NYSE:IPG) with a price target of $38. Analyst David Karnovsky issued the ratings update. 

According to Insider Monkey’s data, The Interpublic Group of Companies, Inc. (NYSE:IPG) was part of 30 hedge fund portfolios at the end of June 2022, compared to 32 in the last quarter. Harris Associates is the biggest position holder in the company, with 14.5 million shares worth nearly $400 million. 

Here is what Ariel Fund & Ariel Appreciation Fund has to say about The Interpublic Group of Companies, Inc. (NYSE:IPG) in its Q3 2021 investor letter:

“Marketing communication company, Interpublic Group of Companies, Inc. (IPG) was the top contributor over the trailing one-year period. Notably, IPG is delivering a stronger than expected revenue mix between Technology and Healthcare relative to its peer group, solid cost containment and margin expansion. Meanwhile, the company continued to focus on de-levering the balance sheet. In our view, IPG’s Acxiom acquisition for data has proven to be a winner, helping the company increase their revenue across all eight major advertising sectors by industry. We believe these results continue to demonstrate the strength and resiliency of the business model and expect IPG to be a beneficiary of increasing advertising and marketing budgets across an improving global economy.”

1. The Trade Desk, Inc. (NASDAQ:TTD)

Number of Hedge Fund Holders: 34

The Trade Desk, Inc. (NASDAQ:TTD) is a California-based technology company that develops an on-demand platform allowing users to create, manage, and optimize data-driven digital advertising campaigns across various ad formats and channels, including display, video, audio, native, and social on multiple devices. 

On October 5, Susquehanna analyst Shyam Patil said The Trade Desk, Inc. (NASDAQ:TTD) remains a must-own name, supported by a multi-pronged, multi-year secular growth story. He noted that the primary drivers, CTV in both US and international, shopper marketing, Solimar, international, and UID2, are gaining momentum, and he sees a meaningful future upside. The analyst reiterated a Positive rating and a $95 price target on The Trade Desk, Inc. (NASDAQ:TTD) shares.

According to Insider Monkey’s data, 34 hedge funds were bullish on The Trade Desk, Inc. (NASDAQ:TTD) at the end of June 2022, with combined stakes worth about $544 million. Zevenbergen Capital Investments is the biggest position holder in the company, with 3.3 million shares valued at $138 million.

Here is what Baron Funds specifically said about The Trade Desk, Inc. (NASDAQ:TTD) in its Q3 2022 investor letter:

“The Trade Desk, Inc. (NASDAQ:TTD) is the leading internet advertising demand-side platform, enabling agencies and companies to buy and track digital advertising. The company reported 35% growth in sales, a terrific result in a softening advertising market, and the shares rose. EBITDA margins were 37% in the quarter, and cash flow also beat expectations. The company is benefiting from the growth in advertising on Connected TV and advertisers’ desire to work with Trade Desk, as a neutral service provider, as opposed to Google who does not share critical data with its partners/advertisers. Also, Netflix announced that it would be offering a tier of service that includes advertising, which is a seminal moment in the development of digital advertising and a big growth opportunity for Trade Desk. Though it is an expensive stock on near-term estimates, we believe Trade Desk can continue to compound its EBITDA and EPS at a 25% to 30% clip into the future, creating significant value in time.”

You can also take a look at 11 Best Healthcare Dividend Stocks To Buy and 11 Best Prison Stocks To Buy. 

Follow Insider Monkey on Twitter