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HomeNEWSTrade Me shares hit six-month low

Trade Me shares hit six-month low

Trade Me shares have dropped near a six-month low after the online trading site fell out of favour with analysts.

Trade Me shares have dropped near a six-month low after the online trading site fell out of favour with analysts.

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Two research houses downgraded their rating for the online retail platform’s stock, which has been attributed to its loss.

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Trade Me shares have slumped about 12 percent since July 25, a day after reports emerged Amazon had settled on Melbourne as its base for an Australian launch later this year. The drop could be coincidental to Amazons announcement.

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The drop in shares come before Trade Me’s scheduled release of annual earnings on August 24.

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The shares fell as low as $4.85 and were recently down 6.1 percent to $4.90 after Deutsche Bank downgraded the stock to a ‘sell’ rating with a price target of $4.30 and Macquarie Research lowered its recommendation to ‘underperform’ with a $5 price target.

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In May this year, Trade Me purchased Afterpay, an Australian “buy now, pay later” online payments provider. 

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Trade Me’s head of marketplace, Stuart McLean, said Trade Me was pleased to offer an easy and flexible payment option to both its buyers and sellers. 

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McLean also said adding more payment options on Trade Me would “help sellers, and increase the purchasing power for buyers.”

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Forsyth Barr’s James Bascand, who rates Trade Me an ‘underperform’, predicts a 9 percent increase in normalised profit to $92.2 million on an 8.1 percent gain in revenue to $235.7 million.

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