Analysts have lowered their fair value estimate for REA Group by approximately $4 to $251.95. This change reflects slightly higher discount rates and more moderate revenue growth assumptions, despite continued positive sentiment toward the company's outlook.

Analyst Commentary

Analyst perspectives on REA Group reveal a distinct optimism regarding valuation and long-term growth prospects, balanced by some reservations about potential headwinds the company may face.

• Bullish analysts see recent share underperformance as excessive and view current valuations as attractive entry points for long-term growth-oriented investors.
• Long-term earnings per share (EPS) estimates are projected above broader market consensus for the company. This points to confidence in growth strategies and execution into FY26 and FY27.
• Concerns over new market entrants or ongoing regulatory scrutiny are considered manageable, which suggests limited downside risk to the company’s market leadership or near-term earnings outlook.
• Continued positive revenue growth and resilient profitability support an optimistic view and reinforce the firm’s position as a leading digital real estate platform.

• Some analysts note that recent adjustments to fair value reflect more moderate revenue growth assumptions compared to prior expectations.
• Higher discount rates are being applied, which signals a more cautious approach to valuing future cash flows in the current macro environment.
• There is ongoing scrutiny of regulatory and competitive risks, with particular attention to new entrants and ongoing market reviews that could impact future growth momentum.
• The possibility of ongoing share price volatility in response to these factors keeps certain analysts cautious about near-term upside potential.

What's in the News

• The Board of REA Group announced the appointment of Cameron McIntyre as Chief Executive Officer (CEO), effective 3 November 2025. (Key Developments)
• Current CEO Owen Wilson will retire from full-time executive roles and continue as CEO until 31 October 2025 to ensure a smooth leadership transition. (Key Developments)
• After stepping down as CEO, Wilson will take up the role of Chair at REA India Pte. Ltd. (Key Developments)
• Cameron McIntyre brings over 30 years of experience in finance and digital marketplace businesses. He most recently served as Managing Director and CEO at CAR Group Limited. (Key Developments)

Valuation Changes

• Fair Value Estimate: Decreased by approximately A$4 to A$251.95 per share, reflecting updated market assumptions.
• Discount Rate: Increased slightly from 7.57% to 7.84%, indicating a more cautious outlook on risk and future cash flows.
• Revenue Growth: Reduced from 7.15% to 6.42%, pointing to more conservative expectations for near-term expansion.
• Net Profit Margin: Remained steady, with a minor increase from 38.81% to 38.84%.
• Future P/E: Increased marginally from 46.17x to 46.63x, signaling only minimal change in valuation multiples.