Baltic Classifieds Group: Dominant Market Position and Monetisation Upside Drive Undervalued Buy Rating

Ed Young, an analyst from Morgan Stanley, has initiated a new Buy rating on Baltic Classifieds Group Plc (BCG).

Ed Young has given his Buy rating due to a combination of factors that highlight both Baltic Classifieds Group’s strong competitive position and its undervalued share price. He points to the company’s dominance across key verticals like autos, real estate, jobs, and general classifieds in the Baltic region, underpinned by exceptionally high user engagement and traffic versus local competitors. Despite this leadership, he notes that the company still charges less than comparable international platforms, especially in real estate and automotive listings, leaving meaningful room to lift prices and expand revenue over time. Young forecasts robust earnings growth over the next several years, supported by this monetisation potential and by the company’s proven ability to generate strong margins and cash flow.

At the same time, Young acknowledges investor concerns around artificial-intelligence-driven disruption, higher product and technology spending, and recent weakness in automotive activity following tax changes in Estonia. However, he argues that these issues are already more than reflected in the current valuation, with the stock having fallen significantly more than peers and now trading at a notable discount on both free cash flow yield and earnings multiples. In his view, this discount is inconsistent with the company’s structural advantages and long-term profitability prospects. His price target implies meaningful upside from current levels and assumes that auto volumes normalise and that the business can sustain very high margin levels, supporting his conclusion that the shares merit a Buy rating.

In another report released today, TipRanks – PerPlexity also upgraded the stock to a Buy with a p226.00 price target.