Online real estate portal Rightmove (RMV) has delivered robust growth as operating profit surged 12% to £98.2m in the first half of 2018 amid competition from OnTheMarket (OTMP) and Zoopla-owner ZPG (ZPG).
Shares in the company have retreated 2.7% to £49.53 following a small 0.5% rise in membership numbers to 20,450.
Online real estate portals benefit from attractive margins, but the market also has low barriers to entry that can appeal to potential rivals.
Sales at Rightmove have jumped 10% year-on-year thanks to continued growth in its agency and new homes businesses.
The estate agent has also been able to squeeze more money from advertisers as average sales are up £76 to £987 per month compared to a year ago.
While UK house prices have notoriously come under pressure, people are still on the hunt for property as online visits increased 5% year-on-year with Rightmove averaging 139m visits per month.
AJ Bell investment director Russ Mould is cautious over whether Rightmove can continue to grow earnings at such a fast pace and argues it cannot be complacent.
‘Its competitors OnTheMarket and Zoopla are getting stronger, so Rightmove will have to think up new ways to engage with its clients and extra more money from them,’ comments Mould.
