eToro, the Financial sector company, was revisited by a Wall Street analyst yesterday. Analyst Ed Engel from Compass Point reiterated a Buy rating on the stock and has a $66.00 price target.
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Ed Engel has given his Buy rating due to a combination of factors that indicate a positive outlook for eToro’s stock. One of the primary reasons is the recent improvement in eToro’s financial performance, as evidenced by their strong third-quarter results. This has alleviated previous investor concerns regarding the company’s organic growth and the impact of the IPO lockup expiration. The acceleration in user activity in September and October has made eToro’s valuation more attractive to a broader range of investors.
Additionally, eToro’s $150 million buyback authorization is expected to mitigate worries about pre-IPO selling, further supporting the stock’s potential for growth. The company’s rapid expansion in its trading volumes, particularly in equities, commodities, and currency, along with significant growth in eToro Money FX transfers, underscores its position as one of the fastest-growing eBrokers. Despite this growth, eToro’s current valuation does not fully reflect its potential, as indicated by its 14x EPS multiple, leading to the reiterated Buy rating and a price target of $66.