Wall Street analysts initiate coverage of eToro

Investing.com -- Wall Street analysts are bullish on eToro following its recent IPO as the retail investing platform gains traction. 

Four major firms initiated coverage of the stock with optimistic views, citing its differentiated product suite, strong brand recognition, and growth potential.

Citizens began coverage with a Market Outperform rating and an $85 price target, writing, “our rating and target are supported by eToro’s shift to consistent profitability… coupled with our view that its best days of growth are still ahead.” 

Citizens explained that its $85 target for the stock implies ~24% upside and is “based on applying an ~19x multiple on our 2026E adjusted EBITDA estimate.”

Mizuho (NYSE:MFG) initiated at Outperform with a $80 target, highlighting that eToro is “disrupting legacy institutions both globally and in the U.S. by providing both investing tools and learning resources.” 

Analysts pointed to the firm’s features, including “social trading, copy trader, and AI-driven smart portfolios,” adding that a “pending, estimated $80tn generational wealth transfer” is a key long-term driver.

Jefferies called eToro a “unique global retail offering,” initiating with a Buy rating and $80 price target. 

“With leading retail market share in markets like the EU and UK… we believe eToro is uniquely positioned to continue to grow its account base organically at +10% y/y.”

Goldman Sachs also launched with a Buy rating and a $76 price target. “We see ETOR as an attractive market share gain story in the fragmented European retail brokerage market, driven by a differentiated offering,” Goldman said. 

They added: “We expect structural account growth of 10% per annum (p.a.) from 2024-27E” and “adjusted pre-tax margins [to] rise ~300bps from 2024-27E to 39%.”

All four firms see eToro as a beneficiary of the continued shift toward social and digital retail investing.