Is Rocket Fuel Inc. (NASDAQ: FUEL) Better Than It Looks?


After reporting 2Q2016 results that exceeded expectations, Rocket Fuel Inc. (NASDAQ: FUEL) is getting many analysts talking on Wall Street. Some believe that it is one attractive stock that is currently flying under the radar.

At the conference call for 2Q, Rocket Fuel’s CEO Randy Wootton painted a rosy picture of the future, talking about how they are winning large customers and what that means for the longer-term outlook.

Focus on three imperatives

It turns out that Rocket Fuel Inc. (NASDAQ: FUEL)’s success is coming from the management focusing on three strategic imperatives. These are strengthening execution across the company, striving to become a trusted platform partner and improving the value proposition of the brand.

Wootton stated that given the efforts his management team is already making on these fronts, he sees continued trend of success going forward.

What’s Wall Street saying?

Credit Suisse is one Wall Street rating firm that has offered its assessment of Rocket Fuel Inc. (NASDAQ: FUEL) soon after the company released its 2Q2016 results. The firm reiterated its Outperform rating on the stock of Rocket Fuel and issued a price target of $7 on the stock. Shares of Rocket Fuel are currently changing hands in the vicinity of $2.8, which signal a massive upside potential in the stock.

One of the strengths that Credit Suisse sees in Rocket Fuel is the company’s to attract large customers, establish stronger agency relationships and cross-selling its customers.

The other compelling thing that Credit Suisse sees in Rocket Fuel Inc. (NASDAQ: FUEL) is the underlying value of the company’s technology asset. Rocket Fuel is a provider of programmatic marketing platform.

What transpired in 2Q?

Rocket Fuel posted EPS loss of $0.15 on revenue of $117 million. The EPS and topline figures improved from a comparable quarter last year and also exceeded the consensus estimate that called for EPS loss of $0.23 on revenue of $111.2 million.

3Q2016 outlook – Rocket Fuel Inc. (NASDAQ: FUEL)

For 3Q2016, Rocket Fuel Inc (NASDAQ:FUEL) is looking for revenue in the band of $63 to $66 million.


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