Moonpig – next week’s Interims should point to further growth, shares 213p, brokers TP 335p

Mark Watson-Mitchell

The Interim Results to end-October from the £688m-capitalised greetings group Moonpig (LON:MOON) are due to be announced next Tuesday, 9^th December, the accompanying statement could well indicate that the business is still on the growth track.

The Business

The group is a leading online greeting cards and gifting platform, comprising the Moonpig, Red Letter Days and Buyagift brands in the UK and the Greetz brand in the Netherlands.

The group's leading customer proposition includes an extensive range of cards, a curated range of gifts, personalisation features and next day delivery offering.

It offers its products through its proprietary technology platforms and apps, which utilise unique data science capabilities designed by the group to optimise and personalise the customer experience and provide scalability.

AGM Trading Update

On Wednesday, 17^th September, ahead of the AGM, the company issued an Update on the business.

It noted that its trading momentum had continued into the current financial year, aligning with expectations to deliver FY26 guidance.

Moonpig brand revenue is up approximately 10% year-on-year, while Greetz had shown modest year-on-year revenue growth.

Plus subscriptions have surpassed one million members.

The group anticipates adjusted EBITDA to grow at a mid-single digit percentage rate for FY26, with adjusted earnings per share growing between 8% and 12%.

The company plans to continue investing in growth and return value to shareholders through dividends and a share repurchase program of up to £60 million for FY26.

Management Comment

CEO Nickyl Raithatha stated that:

"We have had a good start to the year, demonstrating the continuing power of the Moonpig proposition.

With strong growth in the Moonpig brand and a return to year on year growth for Greetz, we are on track to deliver our FY26 guidance.

We continue to use technology, AI and data to enable our customers to connect with their loved ones in new and creative ways.

AI generated Stickers have quickly become our most widely adopted innovation, with customers now creating two million personalised images every month, demonstrating the resonance of our proposition and the scalability of our technology platform.

Moonpig's unique combination of leading market positions, strong customer retention, good profit margins and robust cash generation puts us in pole position to capitalise on the long-term structural shift to online."

The Equity

There are 340m shares in issue.

The larger holders include Baillie Gifford (9.94%), Liontrust Investment Partners (9.54%), FIL Investment Advisors (9.41%), Aberdeen Investment Management (4.78%), JP Morgan Asset Management (4.55%), Threadneedle Asset Management (4.54%), BlackRock Investment Management (4.35%), Janus Henderson Investors (3.55%), Exponent Private Equity (3.17%) and The Vanguard Group (2.89%).

Share BuyBack

On Friday, 7^th November the group launched a share buyback programme, to repurchase up to £30m of its ordinary shares.

This programme, active until 30 April 2026, aims to return excess capital to shareholders, reduce company capital, and enhance earnings, with all repurchased shares slated for cancellation.

Broker’s View

Analyst Matthew McEachran, at Singer Capital Markets, currently has a Buy note out on the group, with a 335p Target Price.

For the current year to end-April 2026, he looks for sales to rise to £379.7m (£350.1m) while adjusted pre-tax profits could improve to £75.2m (£70.5m), generating 16.6p (15.1p) per share in earnings, together with an increased dividend of 4.15p (3.00p).

Leaping forward into the 2027 year he sees £414.6m sales, £81.4m profits, 18.9p in earnings and a dividend of 4.73p.

The year to end April 2028, he estimates, could show £452.7m revenues, £87.5m profits, earnings of 21.4p and a 5.35p per share dividend.

In My View

A year ago, this group’s shares were trading up to 277.50p each, since when they have been down to a Low of 188.40p.

Now at 213p, I do feel that they are undervalued, especially taking into account the broker’s forward earnings projections, putting them out on 12.8 times current year, then 11.2 times prospective earnings, while the 2028 figure could be just 9.9 times price-to-earnings.

I now set a Target Price of 260p.

(Profile 05.12.25 @ 213p set a target Price of 260p)