Scout24 set for worst day in five months after UBS downgrade

Adevinta ASA

10/07/2023 09:40

** Shares in Scout24  G24n.DE  drop 5%, set for the worst
day in five months, after UBS downgraded the online property
platform to "sell" from "neutral" over persisting pressure on
German housing market
    ** "We expect revenue growth to slow during the rest of the
year as a subdued German housing market potentially leads to
agency bankruptcies," the broker says, noting the shares are
trading at a 5% premium to peers
    ** Given mortgage rates now at about 4% in Germany, UBS
flags vendors are not adjusting price expectations quickly
enough to allow a recovery in transaction volumes 
    ** It also points to rising competition from Adevinta's
 ADEA.OL  Kleinanzeigen business, which has now caught up on
lettings listings and has the no. 2 position in properties for
sale
    ** In addition, UBS expects growth in 2024 to further slow
down, with a deceleration in Scout24's private business as
Tenant+ product reaches maturity
    ** Stock at bottom of German midcap index  .MDAXI 
    

 (Reporting by Linda Pasquini)
 ((Linda.pasquini@thomsonreuters.com))