Trustpilot Group PLC (LSE:TRST) shares offer an "attractive entry point", said UBS, as they sit below recent highs despite the FTSE 250 company's recent strong performance.
Full-year results from the online reviews platform were comfortably ahead of average City forecasts, following a year of "continual upgrades with each set of results", the Swiss bank's analysts wrote in a note to clients.
This was helped by North American bookings rising 26% in a "consistent acceleration" across the last six semesters and average annual contract values growing 17%.
Trustpilot, which is headquartered in Denmark, also updated its guidance for "high-teens" growth in the top-line, which was roughly in-line with the City consensus forecast of circa 17%.
Guidance on profitability was more impressive, the UBS analysts said, with the City consensus pointing to a 12.1% margin, while the new outlook suggests a figure of around 13.4%.
Based on current expected sales of $271 million for 2025 and apply the 13.4% margin, this implies EBITDA expectations of around $32-33 million, which is circa 10% ahead of current consensus forecasts.
With the shares down around 20% in the last month leading into results, "we believe largely due to a market rotation", UBS said the stock was trading at around a 30% discount to its average EV/EBITDA multiple since turning profitable.
"Given the continued strong operational performance and confident outlook, we view the recent softness as an attractive entry point."
Trustpilot shares rose 15% to 320p in initial trading on Tuesday but eased to 291p, a gain of just over 5% - down 18% from three-and-a-half-year highs seen last month.