| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 109.70 | -40 |
| Intrinsic value (DCF) | 116.88 | -37 |
| Graham-Dodd Method | 0.10 | -100 |
| Graham Formula | 0.30 | -100 |
Trustpilot Group plc (LSE: TRST) is a leading global online review platform headquartered in Copenhagen, Denmark. Founded in 2007, Trustpilot operates a SaaS-based platform that connects businesses with consumer reviews, helping users make informed purchasing decisions while enabling companies to build trust and improve their services. The company serves markets in the UK, North America, Europe, and beyond, offering businesses software modules to manage and showcase their TrustScore. Trustpilot operates in the competitive Software - Application sector, leveraging its user-generated review model to foster transparency in e-commerce and service industries. With a market cap nearing £950 million, Trustpilot has established itself as a key player in the digital trust economy, benefiting from the growing reliance on online reviews in consumer decision-making. The company's asset-light SaaS model provides recurring revenue streams while maintaining scalability across global markets.
Trustpilot presents an intriguing growth opportunity in the digital trust and reputation management space, with its platform benefiting from secular trends toward online review dependency. The company's transition to profitability (with £6.2M net income in latest reporting) and positive operating cash flow (£29.4M) demonstrate improving fundamentals. However, investors should note the competitive pressures in the review platform space and the company's relatively small scale compared to some tech peers. The lack of dividends reflects management's growth reinvestment priorities. With a beta of 0.91, the stock may offer some defensive characteristics within the tech sector. Key upside drivers include international expansion and deeper SaaS penetration, while risks include review authenticity challenges and potential regulatory scrutiny of online review platforms.
Trustpilot occupies a unique position in the online reputation management sector, differentiating itself through its open review platform that collects consumer feedback across multiple industries. The company's competitive advantage stems from its first-mover status in Europe and its network effects - as more consumers use the platform, its value to businesses increases proportionally. Trustpilot's SaaS model provides predictable recurring revenue while requiring minimal incremental costs for additional users. However, the company faces challenges from several fronts: niche competitors with deeper vertical integration, free alternatives like Google Reviews, and the risk of fake reviews undermining platform credibility. Trustpilot's technology investments in fraud detection and its 'verified reviews' feature help maintain quality differentiation. Geographically, while strong in Europe, the company faces tougher competition in North America from entrenched players. The lack of a dominant social media or e-commerce parent (unlike some competitors) means Trustpilot must continually invest in customer acquisition. Its B2B SaaS tools for reputation management provide upsell opportunities but compete with broader CRM platforms adding review functionality.