Kevin Tracey of Oberon Asset Management presents the case for Scout24 (ETR: G24), Germany’s dominant property portal, which he argues has been sold off indiscriminately on AI fears even as its revenue growth has accelerated. Scout24 is the clear number one in its market, drawing roughly twice the traffic of the second-place portal and carrying materially more listings. Tracey grounds the bull case in a structural point: outside the United States there is no MLS, so leading portals must build their own listings databases, which gives the winner durable pricing power — the same dynamic that produced 60–70% EBITDA margins and strong long-term growth at comparable peers Rightmove in the UK and REA Group in Australia. On the central worry, he contends that large language models fail all three things buyers actually need — listing completeness, speed, and data richness — and today link out to dominant portals rather than replace them; external LLMs account for under 0.5% of Scout24’s traffic and that share is declining. Germany’s highly fragmented agent market, where the largest single provider represents only a mid-single-digit percentage of listings and thousands of independent agents operate, makes replicating the index especially hard, a point Tracey reinforces by noting that Google built its own property index across the UK, US and Australia in 2009 and shut it down by 2011 on data-quality failures.
Tracey frames Scout24 as the innovator of its peer group rather than a sleepy monopoly: it was first in Europe with conversational search, has an AI chatbot live with an agentic experience to come, and holds proprietary valuation data drawn from unique access to hundreds of local transaction committees. Roughly 80% of its traffic is direct, reflecting a deeply entrenched habit, and its rental subscription product — 500,000 subscribers paying €18 a month to pre-approve tenants for landlords — now contributes about 16–17% of revenue at high profitability, a business few thought viable at launch. On valuation, he points to roughly 15x 2027 earnings against about 10% revenue growth and mid-teens EPS growth, supported by headcount down 20% over two years, a German corporate tax cut of five points phasing in from 2028, the largest buyback in company history at about 7% of shares this year, and the most insider buying of any European portal. He acknowledges the recent acquisition of the number-two portal in Spain as a possible distraction, though management has reaffirmed its focus on Germany. Tracey notes the idea was sourced through an AI-powered insider-buying filter that screens hundreds of companies weekly against a qualitative rubric.
Presentation summary generated by AI