Rightmove is rumoured to be on the cusp of losing its coveted place on the FTSE 100. Despite opening as the biggest riser on the FTSE 100 this morning, the company remains the lowest valued company on the index.
The results of FTSE Russell’s quarterly reshuffle will be confirmed on Wednesday, based on closing share prices the day before. The changes take effect on September 24.
Rightmove has seen its share price dip over the summer months. FTSE Russel automatically drops companies with a market value that puts them below 110 in the rankings, which the online estate agent is perilously close to.
Rightmove has been under increasing pressure from a slowing property market and rising competition, according to the Share Centre. However, it boasted record customer numbers in 2017, with agency and new homes customers up 2% to 20,427.
It also saw continued traffic, with visits up 4% averaging over 125 million visits per month, and the amount of time viewers spent on the site was unchanged at nearly 1 billion minutes per month.
“The company has had a tumultuous year,” it said. “The share price reached a high in May on the back of M&A activity in the sector, but this led to increased competition from the likes of Zoopla and PurpleBricks and this is likely to be the reason why the company finds itself in this vulnerable position.
“A weak housing market in London and the South East and what the group describes as a ‘muted sentiment towards the UK property market’ continues to weigh. However, this didn’t stop the group reporting increases in revenue (10%) and operating profit (12%) year on year. It could be that the bad traits are just outweighing the good at the present time, sending the group in the wrong direction and ultimately to the bottom of the FTSE 100.”
“The UK public has once again moved with Rightmove, spending 11.7 billion minutes on Rightmove platforms in 2017,” said Peter Brooks Johnson, CEO of Rightmove. “Our customer numbers increased to a record high of nearly 20,500, testament to our aim to provide customers with the most effective marketing exposure and the highest quality leads, as well as helping to drive efficiencies within their businesses through tools and support.”
Many city workers will be returning to the Square Mile this morning after the holiday period. All eyes are expected to be on housebuilders, with Redrow set to announce its results on Tuesday and several others, including Berkeley Group and Barratt Developments, due to post updates this week.
Housebuilders’ shares have softened over the summer on slowing house prices. However, with new home registrations soaring 86 per cent in London and the home hunting season expected to be in full swing in the run up to Christmas, there is everything to gain.