Unique User Experience
At the end of August, the new baby of Smartbroker Holding AG saw the light of day. The fact that not all functions are yet available was already communicated in advance. The product range started with all German trading centers and a large number of derivatives partners. Step by step, further offers are to be added. In October, for example, the new platform is to be equipped with foreign trading venues and a securities credit offering. The product range of ETF savings plans is also to be massively expanded. According to the current status, around 1,100 ETF savings plans are planned, of which around 850 will be free of charge. In addition, in October, the move of existing Smartbroker customers who open a new securities account with SMARTBROKER+ and agree to the move will take place to the new platform.
After that, new customer acquisition is to be ramped up again. The fact that existing customers are moving to the new platform should only be logical due to the improved user-friendliness on the web and a new smartphone app. The existing conditions have not changed. Not only does the securities account remain free of charge with SMARTBROKER+, but also the expanded range of ETF savings plans, more than 14,000 funds without an issue surcharge, and securities trading starting from EUR 0 via gettex and trading in approximately 1.5 million derivatives from EUR 0.
Unique integration
In addition to the simplified digital account opening and a usability tailored to a younger target group, according to CEO André Kolbinger, "Germany's most attractive online broker" is likely to score points with younger traders primarily through the introduction of trading with cryptocurrencies. According to the management, this is planned for the beginning of the new year. In the medium term, the declared goal also lies in the closer integration between the two business areas, "Transaction" and "Media".
The Smartbroker Group benefits from 25 years of experience with its four high-reach stock market portals wallstreet-online.de, boersenNews.de, FinanzNachrichten.de and ariva.de. The latest trends, news and signals from the various forums are to be incorporated into the SMARTBROKER+ community tab, which should lead to a significant increase in trading activity. On the other hand, trading from the "wallstreet:online" app is to be made possible. This is so far unique in Germany and thus, in addition to the price-performance ratio, another unique selling point of the Company.
Profit warning only briefly a burden
At the beginning of September, a profit warning due to declines in the media business caused some uncertainty. Sales in this segment fell by around 15% for the first half of 2022. The transaction business again saw expected revenue declines, in part because marketing was almost entirely paused, and the focus was on product investment and the launch. As a result, Smartbroker Holding AG revised its forecast for the full year 2023 and now expects sales at group level between EUR 46 million and EUR 51 million and consolidated EBITDA after customer acquisition costs between EUR -1 million and EUR +1 million.
First half-year with challenges
In the first half of the year, the Smartbroker Group generated revenues of EUR 23.4 million, a decline of 16% year-on-year. Of this, around EUR 9 million was attributable to the transaction business and around EUR 15 million to the media business. Operating EBITDA amounted to EUR 1.7 million in the first half of 2023, which, in addition to the weak stock market environment, was primarily due to increased investments in the transaction business. In the first half of 2022, EBITDA after customer acquisition costs was EUR 4.6 million. On a positive note, securities accounts increased slightly to 272,000 despite a reduction in marketing costs. In addition, the volume of assets under management grew to over EUR 10.1 billion. The gross cash ratio was reported at EUR 21 million.
Share in upward trend
From a chart perspective, the Berliners had to cope with a short dip with the publication of the adjustment of their annual forecast. After publication, the share fell by more than 10% during the course of the day but was subsequently bought up again and is currently trading just below the EUR 12 mark. A break above the annual high at EUR 13 should generate a short-term buy signal with a first target in the EUR 15.35 range. In view of further successes in the integration of existing customers as well as new acquisitions, this level should be seen as an interim step.
Interim conclusion
The first step has been taken with the successful launch of SMARTBROKER+. In addition to the platform's stability, moving existing customers and acquiring new customers and target groups will now be important in the coming months. In any case, the rejuvenated, state-of-the-art platform offers the potential to at least meet the set targets of 75,000 new customers annually from 2024. Various analyst firms also see further share price potential. Due to the adjustment of the guidance, the Hamburg-based Montega lowered its price target from EUR 14 to EUR 13.50, but the verdict is still: "Buy". GBC AG also sees a buy candidate and expects a price potential up to the range of EUR 17.90.
The update is based on the initial Report 11/2021
