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Investing.com -- Swiss Marketplace Group (SIX:SMGC) (SMG), the country’s dominant online classifieds operator, has drawn fresh analyst coverage from Goldman Sachs and J.P. Morgan, both initiating coverage on Thursday.
The firm, which runs major platforms across real estate, automotive and general marketplaces, is seen as a structurally leading digital player in Switzerland, commanding a combined market share of roughly 80% in real estate and about 90% in both automotive and generalist classifieds segments, according to Goldman Sachs.
J.P. Morgan began coverage with an “overweight” rating and a CHF54 price target, while Goldman Sachs initiated at “neutral” with a CHF55 price target.
Both brokerages cited SMG’s entrenched market leadership and potential for continued monetization as key factors in their outlooks.
Goldman Sachs described SMG as a “clear leader in underpenetrated classifieds markets” and noted the company’s scale advantage stemming from the 2021 merger of ImmoScout24, Homegate.ch, and other assets owned by TX Group, Ringier, and dieMobiliar.
The brokerage said SMG generates about 8x more monthly visits than its next competitor in real estate listings, 29x more in automotive, and 18x more in general marketplaces.
Goldman said this reach creates “self-perpetuating network effects and high barriers to entry,” supporting profitability and pricing power.
J.P. Morgan echoed this view, calling SMG “unrivalled” in its domestic market and emphasizing that its brands “outclass their Swiss peers in terms of traffic.”
The brokerage said SMG’s real estate portals attract roughly 8x more monthly web visits than the No. 2 player, while its automotive platforms draw 29x more, and general marketplace sites record 18x more.
Both brokerages highlighted strong financial performance in recent years. SMG posted CHF291 million in revenue in fiscal 2024, up 12% year over year, and an adjusted EBITDA of CHF139 million, representing a 48% margin, according to J.P. Morgan.
The same report forecasts revenue growth of 12% CAGR from FY24 to FY29 and adjusted EBITDA growth of 18% CAGR, with margins expected to reach 63% by FY29.
Goldman Sachs forecast similar trends, projecting around 11% group revenue CAGR between 2025 and 2029, driven by pricing growth in real estate and automotive and increasing transaction volumes in general marketplaces.
It expects adjusted EBITDA margins to rise from 48% in 2024 to 64% by 2029, citing “operating leverage and cost optimization initiatives.”
At current levels, Goldman estimated SMG trades at a 20% premium to its European online classifieds peers based on 2027E EV/EBITDA multiples, which it said reflects SMG’s “strong growth potential and superior market position.”
The brokerage’s “neutral” stance reflected a limited 16% upside versus the 24% average upside across its broader European coverage universe.
J.P. Morgan’s “overweight” rating cited the company’s valuation as “still compelling,” placing it at 21.4x 2026E EV/EBITDA for a 15% EBITDA CAGR over 2026-29, compared with a 19.6x peer average.
The brokerage said SMG’s pricing power, network effects and efficiency gains would underpin the forecast.
Both brokerages pointed to potential regulatory risks. Goldman Sachs cautioned that SMG’s dominant position may draw “scrutiny from the Swiss competition authorities,” while J.P. Morgan noted that the firm’s pricing policy is currently under review by the Price Surveillance Authority.
SMG’s ownership remains concentrated, with TX Group holding about 31%, dieMobiliar 19%, Ringier 19%, and General Atlantic around 8%, according to J.P. Morgan. The company’s free float stands near 23%.
Goldman Sachs noted that SMG’s strong cash conversion ratio, 86% on average between 2025 and 2029E, supports its capital return potential.
The brokerage expects progressive dividend growth from a guided CHF75 million payout in 2025 and left open the possibility of “bolt-on M&A” or share buybacks over the medium term.