Coverage

Strong Top Line Beat Driven by Directional Trading

"1Q25 was the group’s best first quarter since the listing, driven by the strong performance in the Global Markets and Investment Banking business units. The management’s positive outlook for 1H prompted us to fine-tune 2025E net income by increasing it +2%.  We confirm our Neutral rating and raise our TP to €5 vs. €4.7."

"The management confirmed the continuing growth trajectory in the current quarter in each business unit, supporting a positive outlook for the year. 2025 will also benefit from the 12-month consolidation of the recently acquired CAP Advisory (now rebranded as EQUITA Debt Advisory), alongside the management and equalisation fees from the new funds raised in EGIF and EPD III and the solid investment banking pipeline."

Dividend story intact, but now fairly priced

"EQUITA reported a softer-than-expected Q4, with results coming in 5% below our estimates (KECH), consistent with the muted trend seen throughout the year. In this context, we revise our forecasts for FY 2025E and FY 2026E, and introduce estimates for FY 2027E."

"Our FY 2025E estimates move marginally higher, reflecting earlier-than-expected recognition of carried interest, slightly stronger Sales & Trading revenues amid sustained market activity, and strong Q1 guidance. Conversely, we make modest downward revisions to FY 2026E, alongside a c. 3% cut to our DPS assumptions, now at € 0.37– 0.39 for FY 2025–27E, in light of management’s intention to retain payout flexibility ahead of the upcoming board renewal and potential introduction of a new remuneration policy."

"The combined effect of a marginally lower DDM valuation (due to DPS revision) and slightly stronger FY 2025E operating assumptions leaves our EUR4.50 target price unchanged. However, with limited upside and much of the FY 2025E rebound and sector consolidation optionality already priced in, we downgrade our rating from Buy to Hold."