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FRANKFURT (dpa-AFX) – The online broker flatexDEGIRO is considering buying back its own shares after the recent fall in share prices and thanks to a well-stocked cash register. In addition, there may soon be a dividend for shareholders. “We are currently analyzing our capital allocation strategy. This could result in a mixture of share buyback and dividends, ”said company boss Frank Niehage on Tuesday evening in Frankfurt. If that happened, it would be the first direct share of shareholders in the group’s 13-year history or a share buyback.
Niehage assumes that by the end of the year, net financial resources will increase to over EUR 300 million. At the end of 2021, they amounted to approximately EUR 230 million. Shares listed on the SDAX rose on Wednesday.
After the purchase of the Dutch online broker Degiro in 2020, which cost around 250 million euros, there are no acquisitions in the company’s program so far. “Organic growth is our priority now,” Niehage said. “This is how we become cheaper.” Due to the high valuation, especially of unlisted competitors such as Trade Republic and Scalable Capital, currently increasing the number of clients through acquisitions is too expensive.
In the event of a takeover, the costs per customer would now be in the four-digit range, according to Niehage. On the other hand, the manager himself imposed expenses of less than 100 euros in acquiring new customers. These costs would be amortized after approximately six months.
Announcements about a possible share buyback and dividend were received slightly positively on the stock exchange – however, after the dramatic losses of the last weeks and months, the paper managed to grow relatively little.
The Flatexdegiro share price rose by about 4.3 percent to 8,914 euros in the afternoon. It was only on Tuesday that it dropped to EUR 8.59, the lowest level since mid-2020. It absorbed almost all the growth the newspaper had had since the outbreak of the pandemic. As trading activity increased significantly during the lockdown and stock markets rose at the same time, the share price rose to nearly € 30 in June 2021.
At that time, the online broker was worth over three billion euros on the stock exchange – market capitalization is now back below one billion euros. Niehage believes that this is significantly on the low side, so he still buys them himself – recently for a price of just under 13 euros. According to him, he is therefore one of the 30 to 40 most important shareholders in the company. According to him, they still believe in the company’s chances on the stock exchange and do not sell even if an offer was made, for example by a financial investor. A few weeks ago, there was vague speculation in the market that an investor might be interested in an acquisition due to a much lower valuation.
The largest shareholder is still the entrepreneur and publisher Bernd Förtsch, who founded the company in 1999 and today directly and indirectly owns about 14 percent. In addition, the holding company Heliad as well as Degiro’s former shareholders and management board hold larger blocks of shares. Two weeks ago, the company lowered its forecasts for the current year due to declining customer activity and currently difficult general conditions. After the record-breaking 2021, the management board no longer expects an increase in transactions for 2022 – but a decrease. The company is also a bit more cautious than before when it comes to increasing the number of customers.
However, Niehage stuck to the mid-term forecast. The number of customers is expected to grow to 7 to 8 million by 2026, with 250 to 350 million transactions processed annually. Next Tuesday (July 12), the company that sponsors the Borussia Mönchengladbach jersey, and in the new season also on the breasts of FC Sevilla players in the Spanish Champions League, will present key data for the past second quarter after working hours. / zb / ngu / stw
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