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Graham Awards


OnTheMarket price slump despite startling claim about Rightmove

OnTheMarket is delivering agents “a higher marketing yield than Rightmove” according to an investment consultancy which works with OTM.

Investors appear to disagree - on Friday, when the claim was made, OTM’s share price dropped over four per cent while Rightmove’s rose by more than six per cent.

The statement on yield came from Zeus Capital, a so-called ‘banking boutique’ which has in the past helped both OTM and Purplebricks float on the London Stock Exchange.


“On its standard tariff of £331 a month, OTM provides its advertisers 34 leads for every £100 spend: this is more than twice that of Rightmove” it says, suggesting that Rightmove in the first half of this year provided only 16 leads per £100 spend. 

Zeus continues: “We maintain our forecasts which we set on 26 September 2019. Strong cost control and increasing contracted monthly run-rate revenues support management’s indication that OTM should reach breakeven in [quarter two or quarter three] next year. In our view, once it has reach breakeven, OTM should trade on over £10,000 per advertiser (ie over £125m).”

However, at the end of Friday’s trading OTM shares hit just 80p - a drop of over four per cent on one day alone, at the end of a week which saw the portal deliver what analysts suggest were mixed results for the first half of the year.

Friday’s closing price for OTM on the London Stock Exchange was 80p - its lowest closing figure over the week and a far cry from its 148p floating price in February 2018.

Rightmove, by contrast, closed on Friday up over six per cent at 556.88p - its highest closing figure for the week.

It a trading statement issued a few days ago, OnTheMarket showed increased losses offset partly by rising revenue. 

In the six months to the end of July revenue was 14 per cent higher than a year earlier although operating losses had risen from £5.7m to £7.2m. Costs were also up as a result of spending on sales and PropTech.

Its cash-in-hand was down from £15.7m at the start of 2019 to only £8.8m, although on one critical measure - average branch numbers listing on the portal - there was a big rise to 12,622 at the end of last month. 

In September OTM had warned its investors that “Agents are facing well-documented headwinds with lower than usual transaction volumes, reduced lettings fee income, the possible onset of recession, the prospect of a no-deal Brexit and a strong sense of uncertainty and a ‘wait and see’ approach amongst buyers and sellers.”

Zeus remains undeterred, however, and in its statement on Friday said that last week’s figures for the half year “provide clear evidence that OTM is delivering its paying customers a higher marketing yield than its larger peer Rightmove.”

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    Why are so many articles being written as though they are happy to see OTM hitting potholes, when it is the industry's only chance of stopping Rightmove's determined advance to unaffordable monthly fees? OTM has an attractive front end, it's being heavily promoted on the tv and it's delivering excellent quality leads to our company, way more than Zoopla. What's not to like?

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    Agree it's time to support On the Market, look at OPEN RENT online letting at cut price, it's time office based agents supported a trade only portal for traditional agents, so we can stand our ground against the changes coming in the PRS.

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    The only way to stop Rightmove from owning your business is to drop them right away, agents are paying them to steal their own business, ITS MADNESS! why pay high premiums to a company that supports online agencies that are ruining the high street agent. Not only that they cross sell services that you provide by advertising on their site. It's time for all agents to support the only Portal that has the agents interests at the forefront. OTM

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    I am confused, how is OTM putting agents at the forefront? They are a public company and like all public companies they will put shareholders before anyone else?


    Agents will own the majority of the shares


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