EverQuote Analyst Remains Bullish As Auto Carrier Spend Rebounds

Needham analyst Mayank Tandon reiterated Buy rating on EverQuote Inc EVER with a $21 price target.
EVER reported 4Q22 revenue of $88.3 million, below Tandon's $89.3 million estimate and the $90.2 million consensus.
Revenue declined 12.5% Y/Y as auto revenue dropped 4.6% Y/Y, and the "other" vertical decreased 33.3% Y/Y due to soft trends in the health vertical as EVER pulled back on growth efforts.
But VMM and adjusted EBITDA came in better than expected as management effectively managed costs.
Management highlighted that so far, through 2023, auto carrier marketing levels were improving and introduced an upbeat outlook for 1Q23 and FY23.
While the 4Q results were mixed, the analyst appreciated updates like auto carrier marketing trends are on the mend and have improved thus far through 2023, reflected in the upbeat outlook for 1Q23 and FY23.
Tandon raised his FY23 estimates to reflect the upbeat outlook (i.e. steadily improving auto carrier marketing budgets) and flowing the incremental strength in his FY24 forecasts.
While the analyst expects the recovery to be gradual, he views the risk-reward as favorable given that EVER can return to 20%+ "trend" revenue growth by late FY23 and demonstrate improved profitability levels through FY23 and over FY24.
Price Action: EVER shares traded lower by 18.71% at $14.25 on the last check Tuesday.

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