Deutsche Bank starts coverage of Trustpilot at 'buy'
By Michele Maatouk
Date: Monday 11 Nov 2024
(Sharecast News) - Deutsche Bank initiated coverage of review platform Trustpilot on Monday with a 'buy' rating and 331p price target.
"Ultimately, the value of Trustpilot's platform is underpinned by the legitimacy placed on its reviews, which we feel is supported by its open-ended platform allowing for independence, the scope of its proprietary data (circa 300m reviews), and the multitude of content integrity measures," the bank said.
"Since reaching adjusted EBITDA break-even in FY23, Trustpilot's momentum continues to accelerate due to three key self-help measures: (i) an increased sophistication within its pricing/packaging models, (ii) re-focused Google Tag Manager strategies in its less mature regions, and (iii) a focus on cost discipline," DB said.
"Combining the above with unit economics benefits underpins our 15%+ per annum top-line growth and +200bps per annum adjusted EBITDA margin expansion between FY24-26E."
Deutsche Bank said it views near-term execution risk as low due to high revenue visibility and a high-quality management team/board.
At 1310 GMT, the shares were up 4.6% at 268.75p.
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