RBC Capital initiates REA Group stock with Outperform rating

Published 21/10/2025, 07:50
RBC Capital initiates REA Group stock with Outperform rating

Investing.com - RBC Capital initiated coverage on REA Group Ltd. (ASX:REA) with an Outperform rating and a price target of AUD270.00, implying approximately 25% total return potential.

The firm’s analysis positions its earnings per share estimates 3% and 5% above consensus for fiscal years 2026 and 2027, respectively, suggesting stronger performance than market expectations.

RBC Capital believes recent share price underperformance related to CoStar/Domain competition and Australian Competition and Consumer Commission (ACCC) concerns is overdone, based on its assessment of CoStar’s market entry strategy and previous competition inquiry outcomes.

The investment bank expects REA Group to maintain double-digit yield growth, supported by property price increases, depth penetration, and potential expansion into adjacent markets.

RBC Capital notes the stock is currently trading at 25 times FY26 estimated EV/EBITDA, below its historic five-year average of approximately 27 times, suggesting a favorable valuation entry point.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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