Does Recent Share Slide Signal Opportunity in Criteo Stock for 2025?

Wondering what to make of Criteo’s stock after a rocky few months? You are definitely not alone. Whether you are weighing a fresh position or eyeing your existing holdings, the recent numbers grab your attention. Criteo closed at $21.31, but over the last one and three years, shares have dropped a hefty 45.1% and 21.5%, respectively. Even in the past week and month, the slides have continued, with returns of -5.3% and -9.4%. Yet, despite these setbacks, the longer-term five-year return still stands at an impressive 68.1%. This suggests that disruption and opportunity often go hand in hand on the market.

Behind the price swings lies a broader narrative. The advertising technology market has remained dynamic, with digital ad spending patterns shifting in the wake of privacy regulation and changing business sentiment. While Criteo has faced pressure from market sentiment, some investors see the stock’s decline as a reflection of shifting risk perception more than any deep long-term flaw. That is a big reason valuation is front of mind. At current levels, has Criteo become a bargain hiding in plain sight?

On a purely numbers-driven basis, Criteo scores a solid 5 out of 6 on our key undervaluation checks, meaning it is undervalued in almost every way analysts measure. Next, we will dive into the valuation lenses that make up this score. We will also share one approach that is often overlooked, but could give you the best perspective of all.

Why Criteo is lagging behind its peers

Approach 1: Criteo Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model estimates a company’s intrinsic value by projecting future cash flows and discounting them back to their value today. For Criteo, this method uses recent and forecasted cash flows to gauge the stock’s worth beyond daily market swings.

Criteo’s latest reported Free Cash Flow stands at $188.21 Million for the last twelve months. Looking ahead, analysts expect Criteo’s Free Cash Flow to reach $212.94 Million by 2027. While analyst projections cover only a few years, further estimates extrapolated by Simply Wall St suggest gradual increases, with anticipated Free Cash Flow rising to around $283.22 Million by 2035.

Plugging these numbers into a two-stage DCF model, the model calculates an intrinsic fair value of $96.91 per share. With the current stock price at $21.31, Criteo appears to be trading at a 78.0% discount to its estimated fair value. This substantial gap suggests that, by DCF standards, the market may be undervaluing Criteo’s future cash-generating potential.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Criteo.

Our Discounted Cash Flow (DCF) analysis suggests Criteo is undervalued by 78.0%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: Criteo Price vs Earnings

The Price-to-Earnings (PE) ratio is a preferred tool for valuing profitable companies like Criteo because it ties the share price directly to the company’s actual bottom-line performance. This makes it easy to compare earnings power across companies and time periods. Typically, expectations about future earnings growth and company-specific risk push PE ratios higher or lower, as investors are willing to pay more for faster-growing or less risky firms.

Criteo’s PE ratio currently sits at 8.2x, which looks notably low next to two important benchmarks: its Media industry average of 20.3x and the average for its direct peers of 37.9x. At first glance, such a discount could tempt value-seeking investors. However, not all companies should command the same PE. That is where the concept of a “Fair Ratio” comes in, a proprietary Simply Wall St measure that weighs not just sector averages, but also Criteo’s specific earnings growth outlook, profit margins, market capitalization and risk profile.

In Criteo’s case, the Fair Ratio stands at 14.9x, meaning a “normal” market price would likely fall between the current level and the broader sector if growth, risks and margins are balanced properly. Unlike simple peer or industry comparisons, the Fair Ratio cuts through the noise and offers a more nuanced view tailored to Criteo’s unique fundamentals. With its actual PE of 8.2x well below the Fair Ratio, the stock appears to be undervalued on an earnings basis. This suggests the market may not be giving enough credit for Criteo’s profitability and growth profile.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Criteo Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives. Simply put, a Narrative is your personal story about a company, built on your expectations and reasoning behind the numbers, not just the numbers themselves. Instead of just accepting a “fair value” as a static result, Narratives on Simply Wall St connect your assumptions about a company’s future—such as revenue growth rates, profit margins, or potential business risks—to a dynamic forecast and a calculated fair value.

This approach goes beyond single metrics by letting you express your unique perspective, linking a company’s recent performance and long-term vision to your own financial forecast and valuation. Narratives are easy to use and accessible right within our Community page, trusted by millions of investors worldwide to help make smarter buying and selling decisions. By directly comparing your Narrative-driven fair value to the current share price, you gain clarity on whether a company looks undervalued, overvalued or fairly priced based on your own reasoning, not just the crowd’s opinion.

As markets and companies evolve, Narratives update automatically, so big news or financial results are instantly reflected. For example, among investors looking at Criteo, the highest Narrative-derived price target is $51.00 while the lowest is $25.00, showing how even experts can have different, well-reasoned stories supporting their views.

Do you think there's more to the story for Criteo? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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