UK 12:14 Sunday, 4 October 2026
Breaking news and expert analysis on fast-moving AIM and LSE listed shares
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Purplebricks (PURP) floated on AIM during the middle of last month, but its valuation looks on the high side to me.
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Comments
Jim
Yep – this is a train wreck to come.
Using its fixed fee at £798 assuming it sold all its stock each agent would be grossing only £21,000 each a year! – hardly sustainable by any metric.
I am shorting the shit out of this!
alcira16247
Gary
Even if trading figures achieve top end of market expectations (unlikely!), the company is hugely overvalued.
A marketing spend, so far, in excess of £12 million? Your kidding! If the companies TV advertising campaign, featuring those two Muppets, is anything to go by……… don’t give me a lot of confidence in the managements judgement!
What’s the odds that this is going to turn out to be another of those ‘jam’ tomorrow outfits?
Gary Newman
Jim,
Even being generous and using the higher figure of £1080 odd when they include other services, I can’t see how the figures stack up, or that there will be anything in the interims to point to them being on target to do so.
I’m also not convinced that growth in this type of way of selling a house will be anywhere near enough for them to hit their future growth targets, even if they commanded 100% of the market – and if it did become that lucrative then large traditional estate agents would quickly move in on the action and grab market share anyway!
I can only assume that the fact that Woodford funds hold a fair chunk enabled them to raise at the crazy IPO level that they got – although those funds have performed less well in recent years.
I’m cautious generally so would probably wait until the interims to short, but in reality i can’t see anything coming in those that will support thew growth model here.
Hope the short goes well for you – I’d expect it to!
Gary Newman
Alcira,
Totally agree, just wary of suggesting people short it just yet in case they did hit target or were close – would still be totally overvalued but market could react positively to the numbers if they showed big growth.
The safer play for me would be to short after interims, as if they do fail then i think they’ll carry on doing so and plenty of scope for downwards movement over a period of time.
As if that £12 million wasn’t enough on its own, there is an additional £10 million outflow forecast for operational expenses.