Price comparison website operator Moneysupermarket.com (MONY) rebounds strongly, up 18.6% to 184p on news of a brisk trade driven by energy switching in the wake of last month’s utility price hikes. The firm – which in one morning has recouped almost all its losses since the summer’s disappointing interims (11 Jul) – reported a 25% leap in sales compared to the equivalent fourth-quarter-to-date period of 2012.
More encouragingly, in terms of the company’s prospects for the remainder of the year, analysts believe that the company has adapted to new search algorithms introduced by Google (GOOG:NDQ) in May. We have always said the £840 million cap is capable of dealing with anything Google might throw at it and, in terms of its longer-term prospects, believe the threat of the US search engine becoming an effective direct competitor is slim (see our past story).
Analyst David Reynolds of Jefferies comments that Moneysupermarket.com appears ‘on track in the reconstruction of its organic search rankings’.
Numbers for the third quarter were also encouraging with the company reporting group sales up 5% in the period and earnings before interest, tax, depreciation and amortisation (ebitda) ahead by 26%. Excluding the contribution of MoneySavingExpert.com, acquired last year, revenues and ebitda were ahead by 3% and 6%.
Among the company’s various verticals, Money sales were down 4% in the quarter, Insurance sales were 2% ahead, Travel was up 35% and the topline advanced by 11% at the Home Services branch.
Based on his initial read of the numbers Steve Liechti from Investec plans to upgrade 2013 earnings forecasts by around 5%, although will hold off from adjusting his forecasts for 2014. Liechti cites uncertainty over organic search results at the Insurance arm as the reason for holding back on adjusting his 2014 numbers.