Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, mobile advertising solutions specialist Millenial Media (NYSE: MM ) has received the dreaded one-star ranking.
With that in mind, let's take a closer look at Millenial Media's business and see what CAPS investors are saying about the stock right now.
Millenial Media facts
||Baltimore, Md. (2006)
||Internet software and services
||Co-Founder/CEO Paul Palmieri
Co-Founder/Chief Technology Officer John Brandenburg
|Trailing-12-Month Operating Margin
||$123.5 million / $0
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 27% of the 33 members who have rated Millenial Media believe the stock will underperform the S&P 500 going forward.
Just yesterday, one of those bears, All-Star MegaShort, touched on Millenial Media's seemingly unsustainable valuation:
At [120x] forward earnings, they are much more expensive than competitors like Google, Yahoo, Apple, etc. But unlike those companies and Facebook, they are a pure advertising company without their own content platform. That seems like a major competitive problem! [Millenial Media's] price is based on the assumption they can achieve margins comparable to elite content/advertising competitors and that is not going to happen.
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