Overview
Rightmove Plc (RMV) is a property search platform provider in the UK. The company is focussed on providing portal services to make it easy for home finders. Rightmove Plc’s major customers include estate agents, new home developers and lettings agent. The company commenced its operations in the year 2000 and is an alliance between top corporate estate agencies.

Recent News
On 11th November 2019, Rightmove announced that its Finance Director had informed the intention of stepping down from the position to the board. Robyn Perriss, Finance Director, will step down in the later date, which is expected to be in Q2 FY2020.

Financial Highlights – H1 Financial year 2019 (30^th June 2019, GBP, million)

(Source: Interim Report, Company Website)

In the first half of the financial year 2019, due to continued growth in the Agency and New Homes Businesses for the period, the company's revenue recorded an increase of 10 per cent to GBP 143.9 million as against GBP 131.1 million in the first half of the financial year 2018. The company’s operating profit surged by 10 per cent to GBP 108.2 million in H1 FY2019 from GBP 98.2 million in H1 FY2018. The company’s underlying operating profit surged by 10 per cent to GBP 111 million in H1 FY2019 from GBP 101 million in H1 FY2018. The PBT (Profit before tax) stood at GBP 108,082 thousand in H1 FY2019 versus a PBT (Profit before tax) of GBP 98,055 thousand in H1 FY2018. The PAT (Profit after tax) stood at GBP 87,450 thousand in H1 FY2019 versus a PAT (Profit after tax) of GBP 79,255 thousand in H1 FY2018. The underlying basic earnings per share increased by 12 per cent to 10.2 pence in H1 FY2019 versus 9.1 pence in H1 FY2018. The company’s basic earnings per share stood at 9.85 pence in H1 FY2019 versus 8.75 pence in H1 FY2018. The company’s diluted earnings per share stood at 9.81 pence in H1 FY2019 versus 8.69 pence in H1 FY2018. The interim dividend surged by 12 per cent to 2.8 pence in H1 FY2019 versus 2.5 pence in H1 FY2018.

Share Price Performance

Daily Chart as at 12^th November 2019, before the market closed (Source: Thomson Reuters)

On November 12^th, 2019, Rightmove Plc shares were trading at GBX 586.40 at the time of writing before the market close (at 10:10 AM GMT), down by 1.28 per cent against the last day closing price. Stock's 52 weeks High and Low are GBX 607.20/GBX 415.20.

Valuation Methodology

*Peers: Derwent London Plc, IWG Plc and Land Securities Group Plc.

Conclusion
The company had shown good financial performance in the first half of the financial year. Both the top-line and the bottom-line performance have improved for the period. Any macroeconomic changes in the UK housing market will impact the company’s performance. The company operate in a highly competitive market with no barriers to entry and exit. With increased competition, the company may lose its audience and advertisers which will further reduce the revenue of the company. Rightmove Plc being an online service provider will have to invest heavily on its platform maintenance, any failure to innovate will reduce its customer base and financial stability as well.

Based on the risks factors as highlighted above, we recommend investors to keep a “Watch” on the stock at the current price of GBX 596.40 (as on 12^th November 2019, before the market close at 8:05 AM GMT), with support from few catalysts needs to be evaluated at a later stage.

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