Rightmove’s share price is forecast to rise to £53 in the wake of the £2.2bn Silver Lake bid for ZPG.
Yesterday, Rightmove shares closed at nearly £48.
Analysts at Exane BNP Paribas says that Rightmove offers “sustainable double digit structural growth, a rarity in European media”.
The analysis, in a new note to investors, goes on: “Rightmove operates as the UK’s market leading property portal, and one of the country’s most visited websites, charging estate agents a subscription fee to list unlimited inventory (per branch) in an all-you-can-eat model.
“We see Rightmove, underpinned by its must-have status with estate agents, as a key winner from the recent competitive upheaval. Rightmove is also attractively valued relative to international peers.”
Exane has also boosted its target price for ZPG shares to 490p, in line with the Silver Lake bid. Yesterday, ZPG shares closed at 488p.
However, Exane gives Rightmove an ‘outperform’ rating and ZPG a ‘neutral’ rating.
Exane also raises the possibility of ZPG going private.
It notes that Silver Lake plans to make further acquisitions and increase investment in ways “difficult to implement . . . as a listed company”.
Exane continues: “We expect a private ZPG to lead further consolidation of the price comparison space.
“Within property, ZPG’s mergers and acquisition optionality is less obvious to us, but ZPG could potentially leverage its traffic to develop its direct to consumer propositions in our view.”