Domain shares extend losses as Bell Potter downgrades rating
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The news: Domain shares extended losses on the ASX after Bell Potter downgraded its rating on the Nine-controlled real estate platform.
The numbers: Domain shares fell 1.4% to $1.08 by 12:30pm AEDT, having closed 5.6% lower on Wednesday after the company posted a mixed result for the September quarter.
Bell Potter downgraded Domain from 'buy' to 'hold' and cut its target price from $3.50 to $3.20.
Bell Potter also reduced its forecast for Domain's full-year yield from 11% to 10%, operating expenditure from 10.1% to 9.1% and earnings per share by 5% in FY25 and 2% in FY26.
The context: Bell Potter analyst Michael Ardrey noted potential uncertainty in the second half, particularly with the rate cut outlook pushing later into the period.
He said Domain's challenge sits in upgrading its depth products — premium features that drive more traffic to listings — supported by developing proof points on its new social media amplification product, Audience Boost, for increasing views per listing.
Domain is targeting a stronger second-half yield performance, Ardrey noted, which is likely to be supported by a flatter free listings performance in the second-half.
The source: Bell Potter research
