Australian Investment Blog
ASX:REA 10/08/2018
REA Group (REA) – Solid result however market expectations remain high
Stock
REA Group (REA) $85.02 as 10/08/2018
Event
This morning REA reported their full year results and they were broadly inline with expectations, however the stock has rallied +3% on the session. It seemed like a recent sell off in the stock was preempting a weaker set of numbers and probably a more somber outlook than the one they delivered.
The outlook was interesting from REA and although they don’t give specific numbers in terms of earnings, they gave some commentary about the softness in the local housing market which they believe will persist which will reduce overall listing volumes however price increases that came into effect from July and longer sale times will more than offset the reduction in volumes. As it stands, the market is looking for FY19 EBITDA of $550m up around 20% on the year. Clearly, expectations remains very high for REA Group!
REA Group (REA) Chart
Market Matters Take/Outlook
A great business with such dominance in its market place will help it push through price rises for its products / services, however market expectations are high and the external environment seems to be getting tougher from here. View our chart pack covering the technical picture here
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