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Opera Ltd (OPRA)
NASDAQ:OPRA
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Opera
(NASDAQ:OPRA)
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Rating:74Outperform
Price Target:
$20.00
▲(24.15% Upside)
Opera's strong financial performance and positive earnings call are the most significant factors contributing to its overall score. The company's robust revenue growth and strategic initiatives, such as MiniPay, bolster its future prospects. Technical analysis indicates some short-term weakness, but the valuation remains fair, offering a balanced risk-reward profile.
Positive Factors
Revenue Growth
Opera's consistent revenue growth demonstrates its expanding market reach and successful strategic initiatives, such as AI-driven products, which are likely to sustain its competitive position and financial performance over the medium term.
Product Innovation
The introduction of Opera Neon with AI capabilities positions Opera as a leader in browser innovation, potentially increasing user engagement and market share by offering unique functionalities that enhance user productivity and experience.
Strategic Partnerships
The rapid growth of MiniPay and its integration with banking systems in multiple regions underscores Opera's ability to leverage strategic partnerships, enhancing its service offerings and revenue streams through increased user adoption and transaction volumes.
Negative Factors
Margin Pressures
The decline in margins suggests potential cost pressures or increased competition, which could impact Opera's profitability if not managed effectively, posing a risk to its financial health and ability to sustain growth.
Localization Challenges
Challenges in localizing products for new markets like South Korea and Japan may hinder Opera's expansion efforts and user adoption, potentially delaying revenue growth in these regions if not addressed promptly.
Tariff-Related Headwinds
Tariff-related challenges in the U.S. e-commerce sector could affect Opera's revenue growth and profitability, necessitating strategic adjustments to mitigate these impacts and maintain its competitive edge in affected markets.
Opera (OPRA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.47B
Dividend Yield4.76%
Average Volume (3M)889.68K
Price to Earnings (P/E)20.4
Beta (1Y)1.33
Revenue Growth29.62%
EPS Growth-19.65%
CountryUS
Employees599
SectorCommunication Services
Sector Strength97
IndustryInternet Content & Information
Share Statistics
EPS (TTM)0.17
Shares Outstanding89,500,854
10 Day Avg. Volume1,089,944
30 Day Avg. Volume889,680
Financial Highlights & Ratios
PEG Ratio-0.22
Price to Book (P/B)0.89
Price to Sales (P/S)1.74
P/FCF Ratio10.26
Enterprise Value/Market Cap1.08
Enterprise Value/Revenue2.85
Enterprise Value/Gross Profit4.25
Enterprise Value/Ebitda13.95
Forecast
1Y Price Target
$26.30Price Target Upside63.25% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
Opera Business Overview & Revenue Model
Company DescriptionOpera Limited, together with its subsidiaries, provides mobile and PC web browsers. It operates in two segments, Browser and News, and Other. The company offers mobile browser products, such as Opera Mini, Opera for Android and iOS, Opera GX Mobile, and Opera Touch; PC browsers, including Opera for Computers and Opera GX; and Opera News, an AI-powered personalized news discovery and aggregation service. It also provides browser-based cashback rewards under the Dify brand name; owns GameMaker Studio, a 2D gaming development platform; and GXC, a gaming portal. In addition, the company operates online marketing platforms, including Opera Ads, an online advertising platform; and Opera Ads Manager, designs to create, manage, and report on digital advertising campaigns in one place allowing advertisers to reach customers. It operates in Ireland, Singapore, Russia, and internationally. The company was founded in 1995 and is headquartered in Oslo, Norway. Opera Limited is a subsidiary of Kunlun Tech Limited.
How the Company Makes MoneyOpera generates revenue through multiple streams, primarily by offering a freemium model for its browser services, where basic features are free, but premium features require payment. The company earns significant income from advertising, as it partners with various advertisers to display ads within its browser and apps. Additionally, Opera monetizes its services through affiliate marketing, where it receives commissions for directing users to partner services, such as online shopping or gaming platforms. In recent years, Opera has expanded into cryptocurrency services, generating revenue through transaction fees and partnerships with blockchain projects. The company has also secured strategic partnerships with telecommunications companies to bundle its services, further enhancing its revenue opportunities.
Opera Earnings Call Summary
Earnings Call Date:Aug 19, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 29, 2025
Earnings Call Sentiment Positive
The earnings call presented a predominantly positive outlook with strong revenue growth, significant increases in advertising and search revenues, and successful product launches such as MiniPay. There are some challenges, such as tariff-related headwinds and the need for localization in new markets, but these are largely offset by the company's achievements and raised guidance.Q2-2025 Updates
Positive Updates
Strong Revenue Growth
Year-over-year revenue growth of 30%, surpassing guidance of 22% to 26% and marking the 17th straight quarter as a Rule of 40 company.
Advertising Revenue Increase
Advertising revenue grew 44% year-over-year to $93 million, with e-commerce as the fastest-growing vertical, continuing to grow over 100% year-over-year.
Search Revenue Recovery
Search revenue returned to double-digit growth, up 11% year-over-year to $50 million, benefiting from a user base shift to higher ARPU regions.
Opera GX User Growth
Opera GX user base increased by 11% year-over-year to 33 million MAUs with an annualized ARPU of $3.47.
MiniPay Success
MiniPay reached 9 million activated wallets and exceeded 250 million transactions, becoming one of the fastest-growing non-custodial wallets globally.
Positive Financial Results
Adjusted EBITDA was $32 million, above guidance, with $33 million in operating cash flow representing 103% of adjusted EBITDA.
Guidance Increase
Raised 2025 revenue guidance to $585 million to $597 million, reflecting 22% to 24% growth over 2024, with expectations for margin expansion.
Negative Updates
Tariff-Related Headwinds
Tariff-related headwinds in U.S. e-commerce impacted revenue, though global opportunities largely offset these effects.
Challenges in South Korea and Japan
Opera GX soft launch in South Korea and Japan requires more localization, with early-stage results not fully clear yet.
Company Guidance
During the Opera Limited Q2 2025 earnings call, the company reported a significant year-over-year revenue growth of 30%, surpassing their guidance of 22% to 26% and well above the 17% growth recorded in the second quarter of the previous year. Advertising revenue saw a 44% increase, reaching $93 million, with e-commerce being the fastest-growing vertical, expanding over 100% year-over-year despite tariff uncertainties. Search revenue also experienced a resurgence, increasing by 11% to $50 million. The company achieved an adjusted EBITDA of $32 million, exceeding the high end of their guidance range. Additionally, Opera Limited provided an updated guidance for the entirety of 2025, projecting revenue between $585 million and $597 million, equating to a growth of 22% to 24% over 2024. They also raised their adjusted EBITDA guidance to between $136 million and $140 million, reflecting a margin of 23.4% at the midpoint. The call emphasized the strategic importance of their AI-driven browser, Opera Neon, and their stablecoin-based wallet, MiniPay, which has reached 9 million activated wallets.Opera Financial Statement Overview
Summary
Opera demonstrates strong financial health with consistent revenue growth, solid profitability, and a robust balance sheet with low leverage. Despite some margin pressures, cash flow generation remains strong, supporting financial stability and growth potential.Income Statement
Opera has demonstrated consistent revenue growth, with a TTM revenue growth rate of 6.37%. The company maintains solid profitability with a gross profit margin of 67.11% and a net profit margin of 14.53% in the TTM. However, there is a slight decline in margins compared to the previous year, indicating potential cost pressures or competitive challenges.75
Positive
Balance Sheet
Opera's balance sheet is strong, characterized by a low debt-to-equity ratio of 0.01, indicating minimal leverage and financial risk. The return on equity is moderate at 8.63%, suggesting efficient use of equity capital. The equity ratio of 89.38% reflects a robust capital structure with significant equity backing.82
Very Positive
Cash Flow
The cash flow statement shows healthy cash generation, with a free cash flow growth rate of 18.16% in the TTM. The operating cash flow to net income ratio is slightly above 1, indicating good cash conversion. The free cash flow to net income ratio of 92.79% suggests strong cash profitability, though there is room for improvement.78
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 554.72M | 480.65M | 396.75M | 331.04M | 250.99M | 165.27M |
| Gross Profit | 372.28M | 348.09M | 207.40M | 276.45M | 237.30M | 153.16M |
| EBITDA | 113.50M | 114.52M | 173.98M | 39.68M | 10.05M | 56.50M |
| Net Income | 80.59M | 80.77M | 153.30M | 15.04M | -14.97M | 34.31M |
Balance Sheet | ||||||
| Total Assets | 1.07B | 1.06B | 1.01B | 964.69M | 1.12B | 1.11B |
| Cash, Cash Equivalents and Short-Term Investments | 133.82M | 126.80M | 93.86M | 118.66M | 181.01M | 135.02M |
| Total Debt | 9.73M | 9.59M | 10.55M | 7.83M | 13.51M | 8.97M |
| Total Liabilities | 113.93M | 115.48M | 91.09M | 76.47M | 80.17M | 60.95M |
| Stockholders Equity | 955.76M | 940.10M | 919.85M | 888.21M | 1.04B | 1.05B |
Cash Flow | ||||||
| Free Cash Flow | 97.99M | 81.63M | 76.36M | 46.69M | 20.67M | 82.00M |
| Operating Cash Flow | 105.60M | 104.98M | 82.76M | 56.66M | 26.56M | 93.32M |
| Investing Cash Flow | -10.04M | -27.11M | 20.00M | 44.45M | -49.70M | 2.96M |
| Financing Cash Flow | -67.94M | -42.15M | -59.84M | -150.58M | -6.68M | -100.97M |
Opera Technical Analysis
Negative
16.11
Price Trends
17.66
Negative
17.81
Negative
17.56
Negative
Market Momentum
-0.60
Positive
35.31
Neutral
19.17
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OPRA, the sentiment is Negative. The current price of 16.11 is below the 20-day moving average (MA) of 17.93, below the 50-day MA of 17.66, and below the 200-day MA of 17.56, indicating a bearish trend. The MACD of -0.60 indicates Positive momentum. The RSI at 35.31 is Neutral, neither overbought nor oversold. The STOCH value of 19.17 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OPRA.
Opera Risk Analysis
Opera disclosed 61 risk factors in its most recent earnings report. Opera reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Opera Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $2.06B | 14.69 | 20.13% | ― | 5.37% | 13.08% | |
74 Outperform | $1.47B | 20.36 | 8.57% | 4.76% | 29.62% | -19.65% | |
70 Outperform | $913.89M | 83.11 | 1.40% | ― | 12.01% | ― | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
57 Neutral | $430.56M | 41.65 | -0.67% | ― | -38.18% | -107.00% | |
52 Neutral | $722.27M | ― | -123.81% | ― | 16.06% | -134.90% | |
45 Neutral | $720.89M | 35.76 | -115.07% | ― | 116.58% | 62.29% |
* Communication Services Sector Average
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.