REA +1.21% posted a solid 1H result today. We saw huge swings in the share price as the market digested the numbers and the revelation that CEO Owen Wilson will be leaving the business later in the year. The stock traded in an 8% range today, down as much as 4% and up the same at one point before settling. EBITDA with slightly ahead of consensus and listings growth remains positive, with January up 3% y/y. The key watchpoint is rising costs – FY25 operating expenses now expected to grow in the low double digits, up from prior guidance of high single digits – $12-$20m higher than expected.
CEO Owen Wilson’s planned departure later this year is worth noting, he has spent 10 years at the helm, is highly respected in the industry and has done a great job leading the business. However, with the stock already performing well leading into the update and continued growth in housing and listings, we expect this to be a speedbump; the strength of the business model should prevail.
MM remains bullish REA
Add To Hit List
