CRTO

Criteo ($CRTO) Director Buying After 50% Plunge…Extreme Undervaluation vs Management Distrust

11/12/2025 13:29

Criteo ($CRTO), the Paris-based global digital advertising technology company, provides AI-driven retail media and performance media solutions. Competing against tech giants like Amazon and Google with approximately 3,650 employees, the company is currently facing a serious investor confidence crisis. The most striking aspect is the severe stock price decline over the past year. Trading at $45-47 levels in summer 2024, the stock has plummeted to around $22 currently, representing a decline of over 50%. Following a 21% single-day crash on October 30, 2024, the downward trend has persisted. More concerning is the consistent selling pattern by management. From July 2024 to August 2025, key executives including CEO Megan Clarken, CFO Sarah Glickman, CLO Ryan Damon, and CRO Brian Gleason have been consistently selling shares. Notably in February 2025, the CEO sold over 36,000 shares within just a few days at $43-44 price levels, securing $1.57 million in cash. This suggests management may be skeptical about the company's near-term prospects. However, an interesting change has emerged recently. Director Der Van purchased a total of 7,299 shares on November 3rd and 10th. These transactions at $21-22 price levels, worth approximately $160,000, represent the first buying signal after over a year of executive selling. This could indicate an insider recognizing value at current price levels. From a financial perspective, Criteo appears to be significantly undervalued. Q2 2025 results showed revenue of $482.67 million (up 2.4% YoY) and EPS of $0.92, beating analyst estimates. Particularly noteworthy are the valuation metrics. The P/E ratio of 7.6x and forward P/E of 5.08x are significantly below the industry average of 20-25x, suggesting 3-4x undervaluation based on earnings multiples. Businesswise, growth deceleration is evident. While Americas region revenue declined 5.9% YoY, EMEA and APAC regions showed growth of 10.4% and 7.2% respectively. Retail media business grew 11.2%, showing relatively solid performance, but overall growth momentum has slowed. Investors should carefully note the company's financial health. With a debt ratio of 10%, cash holdings of $278.76 million, and operating cash flow of $320 million, the financial structure remains very solid, indicating low near-term liquidity risk. Recent strategic partnerships are also positive factors. Collaborations with Microsoft Advertising (July 2024) and Google's onsite retail media integration (September 2025) should help strengthen competitiveness. Additionally, plans for Luxembourg redomiciliation and Nasdaq listing should improve capital market accessibility. Analysts' average price target of $35.92 suggests approximately 60% upside potential from current levels. However, this assumes business recovery, and achieving these targets may be difficult if current growth deceleration persists. Key criteria for investors to consider at this juncture include: positive signals such as extreme valuation undervaluation, solid financial structure, and recent insider buying. Conversely, concerns include persistent management selling, growth deceleration, and intensifying competition. In an optimistic scenario, current price levels reflect excessive pessimism, and business stabilization could lead to valuation normalization. The most realistic base scenario involves gradual recovery following near-term additional corrections. The risk scenario includes further market share loss and profitability deterioration due to intensifying competition in the digital advertising market. Overall, Criteo presents a situation where investment value and risks coexist. While extreme undervaluation is attractive, management selling and growth deceleration require cautious approach. Consider taking a small portfolio position with a long-term perspective, while closely monitoring next quarter's results and changes in executive trading patterns.