Israeli online CFD platform Plus500 (LSE: PLUS) has seen its share price rise by 70% over the past year, and is currently trading on the main London Stock Exchange at an all-time high. Last week the company published two positive reports: its 2024 financial results and that its stock is now included in the STOXX Europe 600 index. It joins the index on Friday and is likely to increase trading in the stock and demand for the stock from investors following the index and associated exchange-traded funds (ETFs). With it.
Plus500, which operates worldwide, offers an online trading platform using a series of financial instruments, especially CFDs on the prices of various securities – stocks, commodities, forex, cryptocurrencies and more. This is done by purchasing a leveraged contract on the underlying value, which guarantees the rate of increase/decrease in the price of the security.
Plus500, run by CEO David Zruya, trades in London with a market capitalization of £2.1 billion (NIS 9.1 billion). The company benefits when volatility increases as it allows platform users to buy CFDs on securities or any currency, and charges commissions on the difference between the buy and sell prices.
The STOXX Europe 600 index, joined by Plus500, includes 600 European stocks from various exchanges, which, according to index operators, provides broad coverage of 90% of the market. In addition to large-capitalization stocks, it also includes mid- and small-capitalization stocks, with the listed stocks having high liquidity and an average daily trading volume of more than €1 million.
In Plus500’s announcement of its inclusion in the index, it indicated that since its initial public offering in London in 2013, the company has returned $2.3 billion to investors, and it also has a strong balance sheet with cash reserves of about $900 million and no debt, as of the end of 2024. .
“The inclusion of the Plus500 in the STOXX Europe 600 Index for the first time is an important milestone for the Group and is an important recognition of the compounding value we have achieved in recent years,” said Zorya. “With the Group’s strong fundamentals, disciplined approach to achieving and through capital allocation and strong cash generation, we look forward to To continue executing on our strategic roadmap objectives and achieving attractive and sustainable returns for our shareholders.
“The market is undervalued”
Plus500 last week reported preliminary results for 2024. Revenue was $768 million and EBITDA of $342 million, with 36,000 new customers on board during the fourth quarter alone.
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In 2025, the company said it “remains well positioned to continue executing in line with the strategy, developing new products and deepening customer engagement, which in turn will drive growth and shareholder value.”
Investment bank Kantor Fitzgerald gave the Plus500 an “outperform” recommendation and a target price of 3,260 pence, which represents a 12.8% premium to its current price. Last week, bank analyst Edward James wrote that with $900 million in cash, they expect the company to report a big return to shareholders. “We believe the market continues to underestimate the sophistication of the business, and has difficulty understanding the technological advantage the company has over competitors,” James wrote.
Published by Globes, Israel Business News – en.globes.co.il – on January 20, 2025.
© Copyright Globes Publisher Itonut (1983) Ltd., 2025.
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