REA's Margin Management is a Source of Optimism

Dow Jones
08/07

0259 GMT - UBS analysts remain optimistic about REA Group's ability to manage margins and capacity for potential capital management despite uncertainty over the property advertiser's listing volumes. Lucy Huang and Ailsa Lei highlight the News Corp-controlled company's tight cost control and the potential for AI-driven initiatives to support revenue growth at a higher rate than cost growth. However, they tell clients in a note that a backdrop of softer lead indicators and impending changes to property related tax concessions keeps them remain conservative on the outlook for listings through FY 2027 and into FY 2028. UBS keeps a neutral rating on the stock and raises its target price 4.1% to 177.00 Australian dollars. Shares are up 0.7% at A$173.20. News Corp is the parent company of Dow Jones & Co., publisher of The Wall Street Journal and Dow Jones Newswires.

 

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