TBLA · Taboola.com
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $2.32
Note written ·
Price against the kill line
3.9% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $2.32, on record since 11 November 2026. The shares are down 42.7% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $2.32, 13% above the last close (11 November 2026), would show the shares leading the S&P 500 and prove this call wrong.
Research onlyNot in the portfolio.
Last catalyst
Key figures from the filings · Technology
Quarter to 30 September 2026, filed 4 November 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 462
- Revenue, change on a year (%)
- −6.9
- Gross margin (%)
- 33.0
- Operating margin (%)
- 5.8
- Free cash flow, four quarters ($M)
- 175
- Net cash, cash less debt ($M)
- 50.2
- Price to earnings (×)
- 4832.6
- Enterprise value to sales (×)
- 330.6
All filed numbers
What Taboola.com reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 462 | −6.9 | 33.0 | 5.8 |
| first filed | 477 | +2.4 | 29.3 | 1.5 |
| first filed | 466 | +9.1 | 27.8 | 14.9 |
| first filed | 522 | +6.4 | 33.6 | 8.4 |
| first filed | 497 | +14.7 | 28.0 | 1.3 |
| first filed | 466 | +8.7 | 29.1 | 0.0 |
| Pre-tax income ($M) | 24.2 |
| Net income ($M) four quarters: 132 | 18.4 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | −6.5 |
| Operating cash flow ($M) | 235 |
| Capital spending ($M) | 60.2 |
| Free cash flow ($M) | 175 |
| Cash and short-term investments ($M) | 129 |
| Debt ($M) non-current long-term debt | 78.5 |
| Net cash, cash less debt ($M) | 50.2 |
| Deferred revenue ($M) at 31 December 2025, filed 25 February 2026; −5.2% on a year | 10.1 |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 303 |
| Inventory ($M) | Not reported |
| Shareholders' equity ($M) | 936 |
| Market value ($M) | 637,340 |
| Enterprise value, market value plus net debt ($M) | 637,290 |
| Enterprise value to sales (×) | 330.6 |
| Enterprise value to operating income (×) | 4325.8 |
| Price to earnings (×) | 4832.6 |
| Price to book value (×) | 681.1 |
| Free-cash-flow yield (%) | 0.0 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 0.0% of shares outstanding sold short, 4.4 days of average trading to cover, +6.4% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $0 |
| 12 monthsfrom | $0 | $53.3M |
The thesis
Taboola's profit still grew in the third quarter, but a second full-year guidance cut in three months has broken the recovery case, and the shares closed at $2.02 on 10 November 2026, 63.8% below the 52-week high of $5.58 (adjusted daily closes). The fourth-quarter report, expected around February 2027, settles whether the new outlook holds. It needs ex-TAC gross profit of $204.5–213.5 million, against $188.8 million in the third quarter. Ex-TAC gross profit is revenue left after paying publishers, known as traffic acquisition costs (TAC).
The 4 November 2026 report met the floors set in August. Ex-TAC gross profit was $188.8 million, up 6.8%, against the $184 million floor. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortisation) was $56.0 million, up 16.1%, against the $51.5 million floor (Taboola Form 8-K, 4 November 2026). Revenue fell 6.9% to $462.3 million.
The guidance is what moved the shares. Full-year ex-TAC gross profit is now $754–763 million, down from $772–783 million. Adjusted EBITDA is now $212–221 million, down from $228–240 million. Revenue is now $1,882.5–1,898.5 million, down from $1.930–1.956 billion. Company news on 4 November 2026 put the fourth-quarter revenue guide of $477–493 million against a $535.3 million analyst estimate.
The narrative is dead as a recovery story: the August cut was blamed on Google's removal of Explore More, and the November cut adds a lower number of ad impressions per page view. Management linked that to AI-driven changes in how people use the open web, and said the Explore More replacement, NextEngage, is ramping more slowly than expected (Finviz, 4 November 2026). The latest close is $2.02. The 14-day relative strength index is 14.3, a reading that shows heavy selling, and the three-month price change is −48.7%.
Bullish and bearish views on Taboola.com Ltd.
The bull case on Taboola.com Ltd. (TBLA), in brief: profit margins keep widening. The bear case: guidance was cut twice in three months.
Bull case
- Profit margins keep widening. Q3 adjusted EBITDA margin on ex-TAC gross profit was 29.7%, up from 27.3% a year earlier, and GAAP net income was $18.4 million against $5.2 million (Form 8-K, 4 November 2026).
- Buybacks continue with fresh authority. Taboola paid $30.4 million to repurchase shares in Q3 and $94.6 million over nine months, and its board added a $200 million authorisation (Form 8-K; Finviz, 4 November 2026). Cash and equivalents were $128.7 million on 30 September 2026.
- The fourth quarter is guided to a step up. The company guides Q4 ex-TAC gross profit to $204.5–213.5 million and adjusted EBITDA to $73.5–82.5 million, against $188.8 million and $56.0 million in Q3 (Form 8-K, 4 November 2026). Delivery would show profit rising even as revenue shrinks.
- Analysts still carry targets above the price. Needham maintained Buy and cut its target to $4 on 5 November 2026, double the $2.02 close. StoneX moved to Hold the same day, from Buy with a $5 target on 20 October 2026 (company news headlines).
Bear case
- Guidance was cut twice in three months. The 5 August 2026 report cut revenue guidance, and the 4 November 2026 report cut ex-TAC gross profit and adjusted EBITDA ranges as well. Revenue growth was +9% in Q1, +2% in Q2 and −7% in Q3 (Finviz, 4 November 2026).
- The cause looks structural. Management attributed the cut to fewer ad impressions per page view tied to AI-driven changes in open-web use. Unlike the Google policy change, no product fix is named for that.
- Cash generation weakened. Free cash flow was $20.4 million against $46.3 million a year earlier, as capital spending rose to $15.2 million (Finviz, 4 November 2026). Net cash fell to about $50 million from $61 million in Q2 and $84 million in Q1 (same source), while buybacks continued.
- The Q4 guide leans on a rebound. Revenue guidance of $477–493 million sits above Q3's $462.3 million, even though Q3 revenue fell 6.9%. Analyst estimates before the report were higher still, at $535.3 million (company news, 4 November 2026).
- Legal overhang remains. A US securities class action covers purchasers from 6 May to 4 August 2026; the lead-plaintiff deadline passed on 20 October 2026.
Price setup
The adjusted close was $3.48 on 28 October 2026 and $2.02 on 10 November 2026. The shares now sit 63.8% below the 52-week high of $5.58. Finviz showed the 200-day moving average near $4.00 on 4 November 2026, so the price is far below it.
A relative strength index of 14.3 marks one of the most oversold readings the stock can print. It describes the speed of the fall. It does not show that selling has ended. Adjusted daily closes carry no support level the shares have defended at this price, so the 10 November 2026 close is the reference point.
Crowding evidence is thin. No earnings date is imminent, and no SEC Form 4 insider transactions appeared in recent filings. Buybacks of $30.4 million in Q3 did not prevent the decline.
Catalysts ahead
- ~16 November 2026 (est.): Expected effective date of the Dianomi acquisition by Taboola Europe Limited. Closing adds the finance-publisher network whose ex-TAC gross profit contribution is untested; the longstop date is 31 December 2026.
- ~February 2027 (est.): Q4 and full-year 2026 results. Tests the Q4 guide of $204.5–213.5 million ex-TAC gross profit and $73.5–82.5 million adjusted EBITDA.
Elapsed catalysts
- 12 November 2026: Court hearing on the Dianomi plc scheme of arrangement. The sanction decides whether the Dianomi acquisition closes on the expected timetable. (passed)
What would change the view
A daily close above $2.32, 13% above the last close (11 November 2026), would show the shares leading the S&P 500 and prove this call wrong.
What it trades with
Taboola's revenue depends on traffic from publisher sites and on platform rules set by Google and AI answer engines. A further search or AI-interface change affects it directly. The shares trade as a small-cap advertising-technology name, and peers that depend on open-web traffic face the same impression pressure. The Motorola DeeperDive partnership announced on 28 October 2026 has no disclosed revenue.
The evidence, claim by claim (7)
- Q3 2026 revenue was $462.3 million, down 6.9%; ex-TAC gross profit was $188.8 million, up 6.8%; adjusted EBITDA was $56.0 million, up 16.1%; net income was $18.4 million. Taboola Q3 2026 results, Form 8-K exhibit 99.1 · as of
- Full-year 2026 guidance cut to ex-TAC gross profit $754–763 million (from $772–783 million), adjusted EBITDA $212–221 million (from $228–240 million), revenue $1,882.5–1,898.5 million. Taboola Q3 2026 results, Form 8-K exhibit 99.1 · as of
- Q4 2026 guidance: revenue $477–493 million, ex-TAC gross profit $204.5–213.5 million, adjusted EBITDA $73.5–82.5 million. Taboola Q3 2026 results, Form 8-K exhibit 99.1 · as of
- Taboola paid $30.4 million for share repurchases in Q3 ($94.6 million over nine months); cash and equivalents were $128.7 million. Taboola Q3 2026 results, Form 8-K exhibit 99.1 · as of
- Management tied the cut to fewer ad impressions per page view from AI-driven changes in open-web use; NextEngage is ramping more slowly than expected; free cash flow was $20.4 million versus $46.3 million. Finviz report on Taboola Q3 2026 results · as of
- Dianomi plc scheme expected effective 16 November 2026, court hearing 12 November 2026, longstop date 31 December 2026; 64p per share in cash plus up to 24p contingent. Dianomi RNS timetable via Investegate and Kalkine · as of
- Adjusted close was $2.02 on 10 November 2026; 52-week high $5.58; three-month price change −48.7%; 14-day relative strength index 14.3. Split/dividend-adjusted daily closes · as of
Sources
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