Google Ruling Sends Supply-Side Ad Tech Names Soaring

The US Department of Justice's antitrust ruling against Google has sent supply-side ad tech names soaring, but demand-side companies are sitting out the rally. Magnite shares have jumped 5% to $25 after Craig-Hallum raised its price target on the company to $32, citing the ruling as a positive development for independent sell-side platforms.

PubMatic is also rising, up 6% to $17.79, as investors bet that the new rulebook will give these companies more access to Google-controlled inventory. In contrast, The Trade Desk's shares have barely budged, down just 0.5% to $14.42.

The Justice Department had sought to separate Google's ad exchange and publisher ad server, but the court chose behavioral fixes instead, which will allow Google to keep its AdX and DFP assets intact. The new rulebook requires Google to build interoperability between its ad exchange and ad server, send exchange bids to rival publishers on equal terms, and share bid win and loss data with them.

The remedies will be in place for six years and apply globally, with a joint final judgment due in early October. Investors are advised to take a cautious approach, as the setup relies on Google building interoperability and enforcing the new rules, both of which may involve negotiation and potential slippage.