Skip to main content
The Markets by Proactive
Go to Proactive UK
Proactive UK has moved. Proactive’s coverage of London’s small caps continues on proactiveinvestors.com Go there →
Advertisement
The Markets
by Proactive
Proactive UK has moved.
Coverage of London’s small caps continues on proactiveinvestors.com
Go to Proactive UK
The Markets
by Proactive
Proactive UK has moved.
Small-cap coverage continues on .com
Go to Proactive UK
Advertisement
The Markets
by Proactive
Proactive UK has moved.
Small-cap coverage continues on .com
Go to Proactive UK

Investments and investor services

Plus 500 hammered again as client-wins and subdued markets send revenues tumbling

Revenue was hit by clients winning US$28.1mln on their trading

Brokers were feverishly chopping forecasts for CFD group Plus 500 (LON:PLUS ) after another disappointing trading update.

Tighter trading controls and less volatile financial markets saw first-quarter revenues drop 65% to US$54mln with the average customer spend falling by a similar amount.

Revenue was also hit by clients winning US$28.1mln on their trading.

Peel Hunt chopped its profits forecast for the year by 35% to US$163mln and its target price to 1050p from 1300p.

House broker Liberum also reduced its target price to 1,000p.

Asaf Elimelech, Plus500's chief executive, said it was a surprise how subdued financial markets were given the political and economic backdrop.

“Financial markets provided limited trading opportunities for current and new customers in the first quarter and It is impossible to predict market conditions for the rest of the year,” added the statement.

Active customer numbers were 4% lower though there was a 10% rise in new clients.

Peel Hunt said Plus500 is a digital marketing business that relies on a relatively low fixed cost base with variable costs targeting client acquisitions.

Concerns remain in the longer-term sustainability of the business, it added, though the broker added it remains a stock for the brave.

Shares tumbled 32% to 487p and have shed three-quarters of their value since last August.

Advertisement
The Markets
by Proactive
Proactive UK has moved.
Small-cap coverage continues on .com
Go to Proactive UK