- Plus500 Ltd (DI)
- 30 April 2025 12:05:10
Source: Sharecast
Canaccord Genuity said key highlights from the Israeli-founded firm's Q125 trading update were news that total revenue had dropped 5% to $205.8m, with customer income up 4% at $176.3m, while customer trading performance sunk 50% to $15.4m, interest income slipped 8% to $14.1m, and underlying earnings were down 9% at $93.8m.
Encouragingly, however, Canaccord noted that underlying average revenue per user was 7% higher year-on-year at $1,351 and average user acquisition cost was 9% lower at $1,205.
"So, given the relatively weak YoY progress in major KPIs, why was the statement so upbeat and why did it state, 'FY25 results expected to be ahead of market expectations'?," asked Canaccord Genuity.
"Principally, we believe management has been given this confidence based on what we anticipate to be an exceptionally strong Q225, driven by the market turmoil caused by Trump's tariffs," it said.
The Canadian bank, which reiterated its 'hold' rating on the stock, made a number of adjustments to its own forecast assumptions, resulting in CY25 earnings per share being upgraded by 11%, largely driven by an expected improvement in the churn rate to 44%. Conversely, Canaccord cut EPS estimates for CY26 by 13% after reducing its customer acquisition and underlying ARPU assumptions.
Reporting by Iain Gilbert at Sharecast.com
