Why MNTN Remains a Buy Despite a Sharp Price Drop

In the rapidly evolving landscape of digital advertising, MNTN has emerged as a standout player in the performance-driven Connected TV (CTV) sector. Despite recent volatility in its stock price, the company’s strategic positioning, robust financial performance, and growing analyst support make it a compelling long-term investment.

Strategic Leadership in a High-Growth Market

MNTN’s dominance in the CTV advertising space is underpinned by its AI-powered Performance TV platform, which democratizes access to TV advertising for small and mid-sized businesses. According to a report by MNTN’s investor relations team, Performance TV revenue surged 35% year-over-year to $67.8 million in Q2 2025, driven by the adoption of its MNTN Matched product and self-serve tools [1]. This growth reflects a broader industry shift: 65% of marketers now classify CTV as a performance channel, and 58% plan to increase their CTV spend in the second half of 2025 [3].

The company’s ability to attract first-time TV advertisers further underscores its market expansion. Data from MNTN’s Q2 earnings report reveals that 97% of customers launching campaigns in 2025 had no prior TV advertising experience [1]. By simplifying ad buying and delivering measurable outcomes—such as web visits and revenue—MNTN is not only capturing existing demand but also creating new markets.

Financial Resilience and Margin Expansion

MNTN’s financials tell a story of disciplined execution and operational efficiency. In Q2 2025, the company achieved a 700 basis point improvement in gross margin, which rose to 77% from 70% in the prior-year period [1]. Adjusted EBITDA also soared 92% year-over-year to $14.5 million, demonstrating the platform’s scalability and profitability [1]. These metrics are particularly impressive given the broader economic headwinds, including rising ad spend scrutiny and macroeconomic uncertainty.

The surge in customer adoption has been equally impressive. Active Performance TV customers grew 85% year-over-year, with the majority hailing from the small and mid-sized business segment [1]. This customer base, which historically lacked access to TV advertising, is now a key driver of MNTN’s growth trajectory.

Analyst Momentum and Wall Street Confidence

Recent analyst upgrades have further solidified MNTN’s investment thesis. Tigress Financial initiated coverage with a “Buy” rating and a $28.00 price target, implying a 34% upside from its current price [4]. Evercore ISI Group’s Mark Mahaney upgraded the stock to “Outperform” with a $39.00 target, representing an 86.7% upside [3]. Morgan Stanley maintained its bullish stance, assigning an “Equal-Weight” rating with a $25.00 target [3]. These actions reflect growing confidence in MNTN’s ability to capitalize on the $12 billion CTV advertising market, which is projected to grow at a double-digit rate through 2027.

Long-Term Potential Amid Near-Term Volatility

While MNTN’s stock has experienced a sharp correction, this appears to be a buying opportunity rather than a warning sign. The company’s first-mover advantage in performance-driven CTV, coupled with its expanding client base and margin improvements, positions it to outperform in the long term. As stated by MNTN CEO Mark Douglas, the platform’s success lies in its ability to “democratize TV advertising for a new generation of marketers” [1]. This aligns with industry trends, as 79% of agencies using MNTN report increased client confidence in CTV expertise [2].

Investors who focus on the company’s strategic moat—its AI-driven technology, low barriers to entry for advertisers, and strong client retention—will likely find the recent price drop to be a mispricing of its long-term potential.

Conclusion

MNTN’s combination of market leadership, financial strength, and analyst momentum makes it a compelling buy despite near-term volatility. As the CTV advertising market matures and performance metrics become the industry standard, MNTN is uniquely positioned to capture a disproportionate share of growth. For investors with a multi-year horizon, the company’s current valuation offers an attractive entry point into a high-conviction opportunity.

**Source:[1] MNTN Reports Strong Second Quarter 2025 Results [https://ir.mountain.com/news/news-details/2025/MNTN-Reports-Strong-Second-Quarter-2025-Results/default.aspx][2] 2025 is “The Year Of Independent Ad Agencies.” CTV Is...
https://research.mountain.com/trends/2025-is-the-year-of-independent-ad-agencies-ctv-is-helping-them-do-it/[3] MNTN Stock Forecast 2026 - Everest Consolidator Price [https://tickernerd.com/stock/mntn-forecast/][4] Tigress Financial initiates MNTN stock with buy rating on CTV ad potential [https://www.investing.com/news/analyst-ratings/tigress-financial-initiates-mntn-stock-with-buy-rating-on-ctv-ad-potential-93CH-4097600]