Berenberg lowers target price on Baltic Classifieds

(Sharecast News) - Analysts at Berenberg lowered their target price on Baltic Classifieds from 395p to 360p on Thursday following the group's "very brief and unscheduled" AGM trading statement on 24 September. Baltic Classifieds pointed to continued weakness in the Estonian car market and, as a result, revised its full-year outlook. Baltic Classifieds now expects revenue and profit growth for the full year to be 3-4% below its previous expectations.

"We revise our numbers to reflect this revised guidance, effectively reducing our FY26 revenue and profit estimates by 4%. We also adjust our share buyback assumptions accordingly. We understand that the other divisions continue to trade as expected. This means that we expect growth to fall short of management's target of 15% annual revenue growth set out by the company at its IPO," said Berenberg.

"We maintain our growth assumptions in outer years, prudently assuming that the Estonia car tax is not repealed and that trading volumes remain at lower levels due to the increased cost of business."

The German bank said the stock now trades on a FY26 price-to-earnings ratio of 27.0x and an FY26E free cash flow yield of 4.0%. Berenberg added that it continues to value Baltic Classifieds using a discounted cash flow and P/E multiples approach.

"The stock is now trading at a discount to its two-year historical average of 33x FY1 P/E, which we think is an attractive entry point to what remains a compelling investment case," added Berenberg, which reiterated its 'buy' rating on the stock.

Reporting by Iain Gilbert at Sharecast.com