Stock Analysis & Valuation OnTheMarket plc (OTMP.L)

• Previous Close: £109.08
• Sector Valuation Confidence Level: High

Valuation method	Value, £	Upside, %
Artificial intelligence (AI)	n/a	n/a
Intrinsic value (DCF)		n/a
Graham-Dodd Method	0.23	-100
Graham Formula		n/a

Strategic Investment Analysis

Company Overview

OnTheMarket plc (OTMP.L) is a leading UK-based online residential property portal, offering comprehensive property search services for buyers, sellers, landlords, and tenants. Founded in 2015 and headquartered in London, the company operates OnTheMarket.com, a platform that lists properties for sale and rent, connects users with estate agents, and provides specialized listings such as retirement properties, student accommodation, farms, and land. As part of the Internet Content & Information industry within the Communication Services sector, OnTheMarket competes in the highly dynamic UK property market, leveraging its digital-first approach to challenge established players. The company focuses on delivering a user-friendly experience while maintaining strong relationships with estate agents, differentiating itself through transparency and agent-backed listings. With a market capitalization of approximately £92.8 million, OnTheMarket continues to expand its footprint in the competitive UK property portal space.

Investment Summary

OnTheMarket plc presents a high-risk, high-reward investment opportunity in the UK property portal market. Despite reporting a net loss of £167,000 in FY 2023, the company generated £34.4 million in revenue and maintained a positive operating cash flow of £7.9 million, indicating underlying operational resilience. Its beta of 1.408 suggests higher volatility compared to the broader market, reflecting sensitivity to UK housing market trends. The lack of dividends and modest cash reserves (£11.3 million) may deter income-focused investors, but growth-oriented investors might see potential in its niche positioning against dominant rivals like Rightmove and Zoopla. The company’s ability to scale profitability while competing in a duopoly-dominated market will be critical for long-term success.

Competitive Analysis

OnTheMarket operates in a fiercely competitive UK property portal industry, dominated by Rightmove (RMV.L) and Zoopla (owned by ZPG). Its primary competitive advantage lies in its agent-backed model, which emphasizes direct engagement with estate agents, offering them a lower-cost alternative to the market leaders. However, its smaller user base and brand recognition limit its ability to command premium advertising rates. The company’s technology platform is robust but lacks the advanced data analytics and AI-driven tools deployed by larger competitors. OnTheMarket’s niche focus on transparency and agent collaboration differentiates it, but scaling this model requires significant marketing investment to attract more consumers. The UK property market’s cyclicality also poses risks, as downturns could reduce agent spending on listings. While OnTheMarket has carved out a viable position, its long-term success hinges on narrowing the gap with Rightmove and Zoopla in terms of traffic and engagement.

Major Competitors

• Rightmove plc (RMV.L): Rightmove is the UK’s largest property portal, with dominant market share, strong brand recognition, and high-margin revenue from agent subscriptions. Its weaknesses include higher listing costs for agents, which OnTheMarket exploits as a lower-cost alternative. Rightmove’s scale and data capabilities give it a significant advantage in user engagement and advertising revenue.
• Zoopla Property Group (owned by Silver Lake) (ZPG): Zoopla, now privately held, remains a key competitor with strong brand equity and integrated services like mortgage comparisons. Its acquisition by Silver Lake has bolstered its tech investments, but its private status limits transparency. Zoopla’s pricing is more competitive than Rightmove’s, but it still faces challenges from OnTheMarket’s lower-cost model.