Wise (AO) | Buy | Positive feedback from Wise's dual listing presentation

研报英文原文证据摘录

Wise (AO) | Buy | Positive feedback from Wise's dual listing presentation

Wise Buy | Target Price: 1220p

Assuming Wise can fully pay back to customers the interest income received beyond this first 1% yield, Wise still aims to generate

an income before tax margin of c. 15-20% and to grow its income before tax in the 15-20% range in the medium term.

We have kept our estimates unchanged and still see the underlying income growing by 19% LFL in FY 2027E (unchanged and in

line with FY 2026 trends), 18% LFL in FY 2028E (unchanged) and 17% LFL in FY 2029E (unchanged).

We still see the underlying profit before tax (PBT) margins declining by 520bps to 15.5% in FY 2026E, with the underlying gross

margin up by 50bps to 75.6% and administrative expenses up by 31% to GBP1bn. Beyond FY 2026E, we still expect the underlying

PBT margins to climb to 16% in FY 2027E (unchanged), 16.3% in FY 2028E (unchanged), and 16.5% in FY 2029E (unchanged and at

the higher end of the group’s 13-16% medium-term target range).

Unchanged capital allocation strategy

Wise reconfirmed its capital allocation strategy with: 1) a strong commitment to net revenue growth, sustainable profitability

profile and cash generation; 2) a prudent management of strong levels of capital and cash; and 3) some return of capital

(management should provide more details along with its FY 2026 results).

Keep Buy rating, TP 1,220p

We keep our Buy rating on Wise (TP 1,220p) as it has a unique position in the cross-border payment market with significant

market share gain opportunities, the underlying income should keep expanding very rapidly in the coming years, with still

elevated margins and higher FCF, while it still trades on fairly attractive multiples (c. 13x FY 2028E EBITDA for a company growing

its underlying PBT at a c.