UBS sees shares of Life360 rising as advertising revenue ramps up. The bank upgraded the location-sharing platform to buy from neutral. Analyst Chris Kuntarich’s price forecast of $55, revised upward from $52, is about 36% above Thursday’s close. Life360 went public in early June. Since then, the stock is up more than 50%. However, it is down more than 23% since hitting a record high on Dec. 3. In November, shares came under pressure following a mixed third-quarter report. LIF mountain 2024-11-11 LIF since mid-November “With shares down 15% since the 3Q print and trading at 40x our above-consensus FY25 EBITDA we see this as an attractive entry after the recent string of negative catalysts,” Kuntarich wrote. Kuntarich also pointed to increased confidence in the midterm ad revenue opportunity as a major catalyst for the stock. Specifically, he sees scope for advertisements to come from several verticals and formats, including brand partnerships and carousel ads, which appear on the main screen of an app. “After speaking with advertisers, we believe LIF’s ad tech investments, unique data, and brand safe environment should translate to a faster than appreciated ramp in this revenue stream which should come in at high incremental EBITDA margins longer-term,” the analyst said. Meanwhile, pet tracking and elderly monitoring also offer revenue opportunities for Life360. “We view the pet/elderly opportunity primarily as a paid conversion driver and estimate the combined pet & elder care opportunity at $43-217M revenue,” Kuntarich wrote. “That said, pet tracking through Jiobit likely comes in late FY25 and elderly monitoring is more likely an FY26 event.” Life360 is not widely covered, but the few analysts who cover it are bullish. The stock has buy or strong buy ratings from five of six analysts covering it, with the average price target signaling 33% upside, per LSEG.
