Rover Has Multiple Long-Term Secular Tailwinds, Says Analyst

JMP Securities analyst Andrew Boone reiterated a Market Outperform rating on the shares of Rover Group Inc ROVR with a price target of $8.00.
The analyst expected Rover to report third-quarter FY22 top and bottom-line results above consensus.
Boone said TSA passenger Y/Y growth accelerated in August and September, while desktop direct visits growth also accelerated in August and September. This makes the analyst assume that Rover can raise 4Q22 guidance.
He believes Rover has multiple long-term secular tailwinds as pet ownership is at all-time highs, people spend more on pet services, and international penetration continues to grow.
Through Boone's data model, which is based on direct desktop traffic and TSA passengers boarded, he estimates bookings of about 1,525 in Q3.
Rover's disciplined marketing spend combined with bookings outperformance, can lead to better-than-expected EBITDA.
Rover's leading market share, its growth opportunities with new services and international expansion, and healthy cohort retention and repeat booking rates justify the analyst's price target and multiple.
Price Action: ROVR shares are trading lower by 1.00% at $3.98 on the last check Tuesday.