Street Calls of the Week
Investing.com - Bernstein SocGen Group initiated coverage on Rightmove Plc. (LSE:RMV) (OTC:RTMVY) with an Outperform rating and a price target of GBP8.70.
The research firm described Rightmove as a "poster child in classifieds" with impressive metrics including 85% direct traffic, over 95% brand awareness among homeowners, and more than 90% public awareness across the UK.
Bernstein highlighted Rightmove’s strong financial performance, noting its underlying operating profit margin exceeds 70%, with £1.6 billion cash returned to shareholders over the past decade and projections of over £800 million to be distributed in the next four years.
The firm forecasts 7% Average Revenue Per Advertiser (ARPA) growth for FY25-28, driven by annual price increases and upgrades of New Homes to the Ascend package, which currently has 5% penetration.
Bernstein also expects Rightmove’s ’Other’ revenues, including Strategic Growth Areas, to rise at a 23% CAGR from FY25-28, supported by the Mortgage in Principal initiative and signs of recovery in the commercial letting market.
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