Global Online Classifieds Marginalised 2.0 – after the de-rate, quality segmentation takes over and share price performance of Classifieds incumbents is likely to diverge from here

Research evidence excerpt

Global Online Classifieds Marginalised 2.0 – after the de-rate, quality segmentation takes over and share price performance of Classifieds incumbents is likely to diverge from here

g an investment gap that

its peers have yet to close. From here, we continue to argue for more investment Alexei Gogolev AC

ahead for many Classifieds peers and for premium valuations accruing primarily (1-212) 622-9391

to those platforms that have already made the required, likely substantial, alexei.gogolev@jpmorgan.com

J.P. Morgan Securities LLC

technology investments.

Isabella A Camaj

(1-212) 834-2379

In this 10th edition of our Global Online Classifieds report, we: 1) delve into the bella.camaj@jpmorgan.com

requirements for Classifieds to become agentic and, importantly, the J.P. Morgan Securities LLC

corresponding impact on margins and future financial growth profiles; 2) provide Australian Technology, Media &

an in-depth analysis of likely rising tech spend and brand advertising costs by Telecommunications

company, which only partly gets offset by headcount efficiencies due to AI AC Bob Chen

savings; 3) look at optionality for M&A activity in the space; and 4) assess current (61-2) 9003-8611

valuation, which indicates that downside still exists for a large part of our coverage bob.chen@jpmorgan.com

universe. For Europe, we believe only Scout24 (maintained OW with best in class J.P. Morgan Securities Australia Limited

tech/product set up) is positioned to outperform. We still see margin driven Benjamin Jones

downside risks for Auto Trader, BCG, Hemnet, Rightmove and Vend (all (61-2) 9003-8627

maintained UW). We also downgrade SMG from OW to N as we anticipate more benjamin.s.jones@jpmorgan.com

J.P. Morgan Securities Australia Limited

investments driving downgrades.