Domain Holdings Australia Ltd Ordinary Shares DHG

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A$2.97 0.00 (0.00%)

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As of May 16, 2024 6:10am Delayed Price Post-Trading: —

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Company Report

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Domain Earnings: Bundling of Audience Boost a Potential Lift to Domain

Roy Van Keulen May 8, 2024

We raise our fair value estimate for narrow-moat Domain by 4% to AUD 2.60 following its third-quarter trading update. The upgrade primarily reflects the time value of money. At current prices, Domain shares screen as materially overvalued and not reflective of Domain’s increasingly distant number two position behind wide-moat REA Group.

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Price vs Fair Value

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DHG is trading at a 485% premium.

Price

A$2.97

May 15, 2024

Fair Value

A$8.30

May 8, 2024

Uncertainty

High

1-Star Price: A$7.47
5-Star Price: A$5.29
Economic Moat: Ddwxsm
Capital Allocation: Xfdy

Bulls Say, Bears Say

Bulls

Domain and REA Group effectively operate a duopoly in residential real estate listings in Australia.

Bears

Domain is significantly overshadowed by REA Group, which has the size and resources to drive down Domain’s market share and profit margins, should it so choose.

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Trading Information

Previous Close Price: A$2.97
Day Range: A$2.95–3.05
52-Week Range: A$2.89–4.30
Bid/Ask: A$2.96 / A$2.98
Market Cap: A$1.88 Bil
Volume/Avg: 1.4 Mil / 1.1 Mil

Key Statistics

Price/Earnings (Normalized): 36.98
Price/Sales: 5.21
Dividend Yield (Trailing): 2.02%
Dividend Yield (Forward): 2.02%
Total Yield: 2.13%

Company Profile

Domain is a technology company operating in the Australian real estate sector. Domain’s primary business is a digital listings platform for residential real estate, www.domain.com.au, which is the second-largest residential real estate listings platform in Australia, after www.realestate.com.au, which is owned by REA Group. Domain is majority-owned by media company Nine Entertainment, while REA is majority-owned by rival media company News Corp. Domain’s other businesses include a digital listings platform for commercial real estate, solutions for developers and agents, and print advertising.

Sector: Communication Services
Industry: Internet Content & Information
Stock Style Box: Small Growth
Total Number of Employees: 1,125
Website: https://www.domain.com.au

Competitors

Valuation

Metric	DHG	REA	SEK
Price/Earnings (Normalized)	36.98	79.97	35.81
Price/Book Value	1.72	16.90	3.13
Price/Sales	5.21	16.55	6.82
Price/Cash Flow	19.75	46.28	25.54

Price/Earnings

DHG

REA

SEK

Financial Strength

Metric	DHG	REA	SEK
Quick Ratio	1.58	1.81	0.89
Current Ratio	1.58	2.28	0.91
Interest Coverage	5.61	19.81	2.63

Quick Ratio

DHG

REA

SEK

Profitability

Metric	DHG	REA	SEK
Return on Assets (Normalized)	3.22%	13.85%	4.27%
Return on Equity (Normalized)	4.38%	24.91%	8.23%
Return on Invested Capital (Normalized)	4.24%	19.23%	6.60%

Return on Assets

DHG

REA

SEK

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