Buzzfeed share price crawls back after earnings. Is it a good buy?

The Buzzfeed (NASDAQ: BZFD) stock price is crawling back after it crashed to an all-time low. It rose by over 6% on Tuesday and by 4.3% in extended hours after it published its quarterly results. The stock has risen by 44% from its all-time low but it remains 65% below its all-time high.

Buzzfeed earnings review

Buzzfeed is a digital media publication that was once seen as a threat to traditional media companies. At its peak, the company was valued at billions of dollars in the private markets. 

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Buzzfeed went public by merging with a SPAC in a deal that valued it over $2 billion. That was a major haircut considering that the stock had a higher valuation than that.

In the past few months, the Buzzfeed stock price has crashed and its valuation moved below $1 billion. This is despite the fact that the company has increased its portfolio to include its eponymous brand, Complex Networks, and HuffPost. 

On Tuesday, Buzzfeed announced relatively strong results. Its revenue rose to $398 million in 2021, which was a 24% gain from the previous year. This growth was mostly because of its advertising and commerce business. Ads rose by 37% to $205 million as Huffpost and Complex contributed just $30 million.

Further, content revenue rose by just 9% to $130 million while commerce rose by 19% to $61.6 million. As a result, the company’s adjusted EBITDA rose to $41 million. In its Q4. the company’s revenue rose to $146 million and an EBITDA of $34.2 million,

So, is Buzzfeed a good investment? A case can be made that the Buzzfeed share price has become attractive. Besides, the company has already dropped by over 60% from its all-time high and its business is growing albeit at a slower pace. 

On the other hand, there are concerns about its profitability and the fact that some of its divisions like news are slowing down.

Buzzfeed stock price forecast

The two-hour chart shows that the BZFD stock price is crawling back in the past few weeks. As a result, it has managed to move above the upper side of the ascending channel that is shown in blue. Also, the stock has moved above the 25-day moving average while the Relative Strength Index (RSI) and MACD have tilted upwards. Therefore, the stock will likely keep rising as investors buy the dips. The initial target is at $6.

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