Shares of Magnite, Inc. (MGNI) tumbled 5.26% in pre-market trading on Thursday, following a price target cut by B. Riley despite the company's strong third-quarter performance. The sell-off comes as investors digest the latest analyst action and the company's recent earnings report.

B. Riley, a notable financial services firm, reduced its price target for Magnite from $28.5 to $25. This adjustment, announced early Thursday, appears to have sparked concerns among investors, leading to the significant pre-market decline. The reasons behind B. Riley's decision to lower the target price were not immediately clear, especially in light of Magnite's positive Q3 results.

Interestingly, Magnite had recently reported robust third-quarter earnings. In a conference call transcript published on Wednesday, CEO Michael Barrett highlighted that the company exceeded total top-line expectations, with Connected TV (CTV) contribution ex-TAC growing 18% and 25% when excluding political advertising. The company also reported strong performance in its DV+ segment and an impressive adjusted EBITDA of $57 million, resulting in a 34% margin. Despite these encouraging figures, the market seems to be focusing on the lowered price target, leading to the pre-market sell-off.