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."

Softening our conservatism

"EQUITA delivered a record Q1, with revenues reaching €23.4m (+36% YOY, +17% vs. KECH) and net profit at €4.7m (+63% YOY), supported by underlying growth across all business lines. The beat versus our estimates was primarily driven by Directional Trading, while higher-than-expected personnel costs related to the phantom share plan partially offset the upside.

Global Markets posted a strong outperformance, Investment Banking remained solid, and Alternative Asset Management (AAM) came in slightly below expectations. The outlook is broadly constructive, with positive momentum in Global Markets and Investment Banking continuing into Q2, whereas AAM seems to face softer fundraising dynamics.

We increase our FY 2025E revenue forecast to €97.7m (prev. €94.9m), mainly on the back of higher Directional Trading assumptions, and raise our DPS estimate to €0.38 (from €0.37). Our valuation, based on an equally weighted DDM and SOP approach, incorporates estimate upgrades, a lower beta, and higher multiples, reflecting the ongoing sector re-rating. As a result, we up our TP from €4.5 to €5.0 and reiterate our Hold rating, as visibility, though improved, remains limited, and upside potential modest."