Stock Analysis & Valuation Equals Group plc (EQLS.L)

• Previous Close: £139.50
• Sector Valuation Confidence Level: High

Valuation method	Value, £	Upside, %
Artificial intelligence (AI)	97.40	-30
Intrinsic value (DCF)	111.27	-20
Graham-Dodd Method	0.11	-100
Graham Formula	1.73	-99

Strategic Investment Analysis

Company Overview

Equals Group plc (LSE: EQLS) is a UK-based fintech company specializing in foreign exchange and banking services for private clients and corporations. Operating under brands like Equals Money, Equals Pay, and FairFX, the company offers prepaid currency cards, travel cash, international money transfers, and current accounts. Its integrated platform combines account-to-account payments, card payments, and multi-currency solutions, catering to both individuals and businesses. Formerly known as FairFX Group Plc, the company rebranded in 2019 to reflect its expanded services. With a strong presence in the UK financial services sector, Equals Group leverages technology to provide competitive FX solutions, positioning itself as a challenger to traditional banks. The company’s focus on digital-first financial services aligns with growing demand for seamless cross-border payments and fintech innovation.

Investment Summary

Equals Group presents an intriguing investment case as a niche fintech player in the UK’s FX and payments market. With a market cap of ~£282M, the company has demonstrated revenue growth (£131.7M in FY 2023) and profitability (£7.4M net income). Its asset-light model generates strong operating cash flow (£22.1M), supporting further expansion. However, the stock’s beta of 0.79 suggests moderate volatility, and competition in digital FX services is intense. The dividend yield (~0.7% based on a 2p/share payout) is modest, indicating a growth-focused capital allocation strategy. Key risks include regulatory scrutiny in financial services and margin pressure from larger competitors. Investors should monitor customer acquisition costs and international expansion efforts.

Competitive Analysis

Equals Group competes in the crowded UK fintech and FX services space, differentiating itself through a multi-brand strategy and integrated platform. Its competitive advantage lies in combining B2B and B2C offerings—Equals Money for corporate clients and FairFX for retail users—creating cross-selling opportunities. The company’s proprietary technology reduces reliance on third-party payment rails, improving margins. However, it lacks the global scale of industry leaders like Wise or Revolut. Equals’ focus on SMEs and expatriates provides a defensible niche, but customer stickiness is lower than with traditional banking relationships. Regulatory compliance (FCA authorization) is a strength, though licensing overhead weighs on profitability. The capital-light model allows agility but limits physical distribution vs. incumbents like Travelex. Partnerships with banking intermediaries (e.g., CardOneMoney) help expand reach but introduce counterparty risks. In the long term, Equals must invest in technology to compete with neobanks while maintaining its FX specialization.

Major Competitors

• Wise plc (WISE.L): Wise dominates the digital cross-border payments market with superior scale (~£1.2B revenue) and a transparent pricing model. Its global reach (serving 160+ countries) far exceeds Equals’ UK focus, but Wise lacks physical card distribution. Wise’s brand recognition is a key advantage, though its B2B offerings are less developed than Equals Money.
• Revolut Ltd (REVO): Revolut is a formidable competitor with 35M+ users worldwide and a broader product suite (crypto, stock trading). Its aggressive pricing pressures Equals’ margins, but Revolut’s lack of FCA banking license (unlike Equals’ CardOneMoney) limits deposit-taking capabilities. Revolut’s focus on retail users contrasts with Equals’ stronger SME presence.
• TP ICAP Group plc (TPE.L): TP ICAP’s Global Broking division competes in institutional FX, a market Equals avoids. Its interdealer strength is irrelevant to Equals’ SME/retail focus, but TP ICAP’s liquidity access could threaten Equals’ B2B ambitions. TP ICAP’s higher complexity reduces agility compared to Equals’ fintech approach.
• Travelex Holdings Ltd (TRAV): Travelex leads in physical FX (airport kiosks), a channel Equals largely eschews. Its brand recognition helps in retail, but debt burdens have hampered innovation. Travelex’s B2B white-label services compete with Equals Pay, though Equals’ digital-first model is more scalable post-pandemic.