Digitalbox PLC's (AIM:DBOX) push into niche digital publishing has won a vote of confidence from Panmure Liberum, which raised its target price on the stock from 7.6p to 10p following the company’s latest results and growth plans.
The upgrade comes after the AIM-listed media group reported a 30% rise in revenue for 2024, with earnings before interest, tax, depreciation and amortisation (EBITDA) margins topping 17% before investment.
Digitalbox, whose brands include Entertainment Daily, The Tab and The Daily Mash, is now targeting a near-doubling of revenue by 2027 through its so-called Verticals Strategy.
The approach is focused on developing tightly defined content brands that attract highly engaged mobile audiences - a shift designed to play to the strengths of platforms like Google and Facebook.
New products in 2024 and 2025 include Emmerdale Insider, Royal Insider and Reality Shrine, building on the success of existing titles.
Panmure acknowledged the upfront cost of growth, trimming its 2025 EBITDA forecast to £0.2 million due to increased investment.
But it expects operating leverage to kick in from 2026 and projects EBITDA of over £2 million by 2027 - 3.7 times higher than last year.
“The company certainly over-delivered in 2024,” the broker said, highlighting the turnaround of acquired assets such as TV Guide and The Poke.
With a market capitalisation of just £5.4mn and shares trading at 4.5p, Panmure believes the business is significantly undervalued. On 2027 forecasts, it sees scope for the share price to more than triple.