REA Group will be reporting its first-quarter result on November 6. UBS expects the first-quarter revenue to be $182m and materially better listings performance. Cost-outs are expected to be at the higher-end or exceed the group’s previous guidance for -5-10% reductions.
Forecasts for the full year remain intact. Any cost upside in the first quarter is expected to be temporary.
The broker reaffirms its Neutral rating with a target price of $107.
Target price is $107.00.Current Price is $123.78. Difference: ($16.78) – (brackets indicate current price is over target). If REA meets the UBS target it will return approximately -16% (excluding dividends, fees and charges – negative figures indicate an expected loss).