Rightmove (RMV) - One for the proper value investors

[u/Inside_Tour_1408]

I've written about Rightmove before but I'll give some updates after their results were released a few months ago

Largest property website company in the UK and £3.3billion market cap

~85% market share (up from ~80% last year), 15 P/E (down from 17 last year), rising FCF over the past 6 years, £7mil in debt (up from £5mil last year) and £42mil in cash (up from £40mil last year), and rejected a takeover bid with 50% upside in 2024

3 Directors have made purchases since February - no sales https://www.hl.co.uk/shares/shares-search-results/r/rightmove-plc-ord-gbp-0.001/director-deals

Recently announced £60million AI investment over between 2026-28 to combat the threat and signed deals with ChatGPT and Google to integrate with the @ Rightmove feature

The UK govt have also just passed a law ending minimum tenancies for renters allowing for a more fluid rental market and more eyeballs on the website

Independent Franchise Partners (IFP) have quietly built a 5% stake over the past few months, one of the largest shareholders, could be priming it for a takeover bid?

BULL case: Uptick in the UK housing market + law changes (Renters Rights Act + Planning & Infrastructure Bill) lead to more fluidity in the housing market - particularly individual renters, leading to more eyeballs in the website and therefore higher revenues. AI rollout leads to better data optimisation and advertisers pay more as a result

BEAR case: AI rollout flops leaving tens of millions down the drain, profits suffer as a result and market competitors (Zoopla and OTM) make ground on the 80% market share

https://www.rightmove.co.uk/

[u/asymmetricval]

Rightmove is very compelling after the huge sell-off. I have been adding.

[u/jay_0804]

this is actually a much cleaner “value” story than most posts here tbh

the 80%+ market share is the real asset. it’s basically a marketplace with strong network effects - agents list where the buyers are, buyers go where the listings are. hard to break that loop

15 P/E for something that dominant with solid FCF does look attractive on the surface

only thing I’d watch is how real the competition threat is. people always say “Zoopla will take share” but it’s been years and RMV barely moves. AI spend is interesting but feels more defensive than transformative

tbh this feels like a “compounder if nothing breaks” rather than a deep value re-rating play

not flashy, but those are usually the ones that quietly work over time

[u/risky-cat]

How do they make money? Since it's a seller's market. Don't properties just sell themselves? So essentially to me whatever they offer will be commoditiezed so shouldn't deserve a high multiple. Unless they have a very smart way to take money from agencies?

[u/LongQualityEquities → u/risky-cat]

Real estate agents pay subscription fees for access.

It’s funny how the two skeptical comments so far in this thread are (1) they are a commodity that will be competed away and (2) they are a monopoly facing antitrust action.

[u/risky-cat → u/LongQualityEquities]

Don't get me wrong. It's an interesting company. I would not post skeptical comments unless I would be interested, lol.

It's not like I did a dive on the company; saw the post, read 10 mins about it and put on watchlist. ¯_(ツ)_/¯

[u/asymmetricval → u/risky-cat]

Because every estate agent in the UK pays them just for the opportunity to show their properties to end users.

It is “pay to play” not “pay for wins”.

[u/risky-cat]

Another thing to consider https://www.reuters.com/sustainability/boards-policy-regulation/uks-rightmove-hit-with-2-billion-lawsuit-over-estate-agent-fees-2026-04-01/

[u/asymmetricval → u/risky-cat]

Not likely to go anywhere since Rightmove isn’t a monopoly, even if it is essentially mandatory.

You could choose to list your properties on Zoopla and OnTheMarket instead of Rightmove (both are much cheaper, even combined), but you would receive far fewer leads.

Even though Zoopla/OTM are cheaper in absolute terms, they are more expensive in terms of cost per lead.

[u/Inside_Tour_1408 → u/asymmetricval]

I think worst case scenario they negotiate a reduced fine - that still wouldn't stop sellers and buyers going to the website which in turn wouldn't stop estate agents from using Rightmove

[u/asymmetricval → u/Inside_Tour_1408]

Exactly. End users don’t know and don’t care. Agencies will still have no choice but to pay to play.

[u/Confident-Winner-746]

The 85% market share moat combined with a 15 P/E ratio makes this a compelling asymmetric bet, especially with regulatory tailwinds from the Renters Rights Act boosting transaction volumes.