I’ve just done a quick price comparison check and Moneysupermarket.com Group PLC (LON:MONY) is a lot cheaper following its half-year results.
As a result of current trends in its energy-supplier-switching business, the group expects full year adjusted operating profit will be at the lower end of the consensus range.
That was enough to send the shares tumbling 11% to 319.7p, trimming the year-to-date gain by the shares to 5.5%.
During the first six months of 2017 group revenues grew 5% from the year before.
The core Moneysupermarket.com business saw its revenues grow 4%. Insurance growth was strong at 18% while Home Services was significantly affected by reduced energy collective switch activity.
According to the company’s statement, “money was flat overall” – must be those new five pound notes - with good growth in credit products.
TravelSupermarket.com revenues were up by 10% for the half year.
Revenue in MoneySavingExpert.com was 4% ahead of last year, and it also saw its growth constrained by less energy collective switch activity.
As at 30 June 2017, the group had net cash of £17.7mln (2016: £10.7mln), even after spending £20mln to date of the £40mln share buyback announced in February.
Having reviewed the cash required by the business and the performance of the group, the board decided to increase the interim dividend by 3% to 2.84p per ordinary share.
Liberum Capital stuck to its 'hold' recommendation following the update.
"We think this is a company that is very well run and we like the management team but we do have issues over the barriers to entry in the price comparison industry and the relative opacity of numbers," it said.
Shore Capital is sticking with its ‘buy’ recommendation and 360p price target, having been reassured by the breadth and depth of the group’s “inventory across a range of verticals”.
“The on-going weakness in energy switching will necessitate an adjustment to our financial forecasts (on a first pass basis we estimate a c.3% reduction at the operating profit level), but we see this is a short term headwind and regard the energy segment as an attractive switching market going forward,” Shore’s Roddy Davidson said.
“Although it is disappointing to reduce our forecasts, we remain fundamentally bullish on MONY’s medium-term attractions. Specifically, we believe the strength of its brand, the breadth of operations highlighted above, the quality and functionality of its desktop and mobile offerings, and perhaps most importantly, its track record of delivering substantial savings to its customers mean it is well placed to capitalise on growth in switching activity,” he added.