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Australian Investment Blog

ASX:REA 10/08/2018

REA Group (REA) – Solid result however market expectations remain high

Stock

REA Group (REA) $85.02 as 10/08/2018

Event

This morning REA reported their full year results and they were broadly inline with expectations, however the stock has rallied +3% on the session. It seemed like a recent sell off in the stock was preempting a weaker set of numbers and probably a more somber outlook than the one they delivered. REA results The outlook was interesting from REA and although they don’t give specific numbers in terms of earnings, they gave some commentary about the softness in the local housing market which they believe will persist which will reduce overall listing volumes however price increases that came into effect from July and longer sale times will more than offset the reduction in volumes. As it stands, the market is looking for FY19 EBITDA of $550m up around 20% on the year. Clearly, expectations remains very high for REA Group! REA Group (REA) Chart  REA Chart

Market Matters Take/Outlook

A great business with such dominance in its market place will help it push through price rises for its products / services, however market expectations are high and the external environment seems to be getting tougher from here. View our chart pack covering the technical picture here

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