Another analyst is weighing in on the state of display advertising, and he is sunnier (in a relative sense) than most of his colleagues: In a research note this morning, Piper Jaffray analyst Gene Munster says the display advertising market stabilized in the first quarter and won’t be as bad for the rest of the year as many other people think.

SEE ALSO: IAB: Online Ad Spending Grew 10.6 Percent In ‘08

Munster had typically been among the most pessimistic analysts on display advertising—until today: he had forecast 13 percent declines for display in the first quarter 2009, but after talking with industry sources, he says he is revising that to 10 percent declines, putting him in line with other analysts. And he thinks the worst is likely behind us. 

Given that declines in display accelerated sharply from the fourth quarter of 2008 to the first quarter of 2009, Munster needs to explain why the acceleration won’t continue. He provides a couple explanations: 1) Some media buyers may have had cash left over from the first three quarters in 2008 that they needed to spend during the fourth quarter, which could have helped fourth quarter results (making the deceleration into 2009 look worse than it actually was); and 2) media buyers who set their ad budgets for 2009 during the first quarter may have been gun-shy with their wallets given the uncertainty around the economy and will spend ad dollars during the remainder of 2009 that they otherwise would have spent during the first quarter 2009.

Still, it’s a gutsy prediction, as no one can be sure the economy won’t take another turn for the worse—and the future of the U.S. auto industry (the nation’s largest advertiser) is so up in the air.