One stock that looks interesting in the new highs on Monday is Rent.com.au [ASX:RNT].
Rent.com.au is a web portal focusing entirely on property rentals. That’s a point of difference in the competitive online real estate market. It wants to be the website of choice for renters.
RNT is going after market share by offering to list/advertise properties free of charge on their basic package.
Customers can enhance the listing by paying for a premium.
They also allow people to list their own properties on there rather than going through a rental agent.
The company listed on the stock exchange in June.
Let’s take a look at the chart. Here’s the daily…
You can see the period of no trading activity in May–June. This is because Rent.com.au became a public company via a reverse takeover of Select Exploration.
Select Exploration delisted and then relisted as Rent.com.au.
The Australian Financial Review reported this morning that, ‘Rent.com.au has topped its 12-month unique traffic target less than halfway through the financial year and has flagged moving into complimentary businesses such as removals and insurance.’
Site traffic for October was up 32% on the previous month.
According to a presentation the company did in October, there are seven million renters in Australia. There are also one million landlords that don’t use an agency to manage their property.
According to rent.com.au, if the landlords don’t use an agency, they can’t advertise on the leading real estate portal.
So there’s plenty of market share for them to tap into. Mind you, realestate.com.au [ASX:REA] has a hugely dominant hold over the rental and sales advertising sector.
Real estate buyer’s advocate (and regular contributor to Cycles, Trends and Forecasts) Catherine Cashmore tells me,
‘As far as I’m aware, RNT is much cheaper than REA, which currently have a monopoly on the real estate advertising market.
‘REA are known for putting their fees up — which, last year, caused a group of agents to threaten to boycott the website and set up their own.
‘There was a lot of huff and puff about it at the time — however, as far as I’m aware, the plans never amounted to anything serious and REA maintain their lead.
‘Domain are their closest competitor. It’s a brave real estate agent who decides to boycott the most commonly searched real estate website — thereby risking that their vendor’s property will fly under the radar.’
However, note one thing: the stock has continued higher after the recent positive news announcement about site traffic numbers. The stock price has broken over previous tops.
That’s usually bullish.
RNT is certainly one for the watch list.
Associate Editor, Cycles, Trends and Forecasts