Team Internet Group – up 30% in one month - is it now time to sell your shares?

Mark Watson-Mitchell
May 12
4 min read

12.05.2025

A month ago, I headlined my article questioning –

“Team Internet Group – is it now time to buy back into this global domain ‘cash machine’ business, with 50% of its revenues US Based? I now set a 65p Target Price.”

The shares were then trading at 50.30p, last Friday they touched 65.30p – breaking through my 65p Target Price – a near 30% gain in just a month.

So, I now ask, is it time to take such a profit and wait for the shares to fall back before getting back in again?

The Business

The company is a leading global internet solutions company that operates in two highly attractive markets: domain name management, identity and software solutions (DIS segment) and high-growth digital advertising (Comparison and Search segments).

The DIS segment is a critical constituent of the global online presence and productivity tool ecosystem, where the company serves as the primary distribution channel for a wide range of digital products.

The Comparison and Search segments create privacy-safe and AI-generated online consumer journeys that convert general interest online media users into confident, high-conviction consumers through advertorial and review websites.

The business derives high-quality earnings from subscription recurring revenues in the DIS segment and revenue share on rolling utility-style contracts in the Comparison and Search segments.

Disappearance Of Q1 Trading Update

This time last year the group announced its Trading Update for its first quarter of the Trading Year, covering the period from January to end-March.

This year, perhaps with some embarrassment, the globe-trotting CEO Michael Riedl has stated that:

“We look forward to providing our next update when the Company publishes its results for the six months ended 30 June 2025 around the end of August 2025.”

I find that very disappointing indeed and perhaps ominous!

Especially so when one considers that there was not even a Trading Update given at the group’s AGM held two weeks ago on Monday 28th April.

Couple that with the delay that the group’s shareholders endured when expecting publication of the 2024 Annual Report & Accounts.

Added to these negative points, it must be remembered that there were two Private Equity houses that approached the group concerning making a possible bid, one dropped out quite quickly, while the other, after a deeper look inside, also then backed out.

Analyst’s Views

Bob Liao and Carl Smith, at Zeus Capital, have current year estimates out for revenues to end-December 2025 will collapse to $726m ($803m in 2024 and $837m in 2023), while its adjusted pre-tax profits could fall to $49.4m ($71.4m -2024 and $77.4m – 2023), which would see earnings ease from 22.5c in 2023, then 21.2c in 2024, dropping to 13.4c per share in 2025.

They have recently commented that:

“Team Internet’s shares fell sharply in March after Google announced that it planned to start opting all Google Ads accounts out of Adsense for Domains (AFD) advertising, the largest portion of Team Internet's Search division.

The company is uncertain of the rate that advertisers will be opted out, how many will opt back in, the timeline for the process or the impact on average click prices.

However, the company has taken action and accelerated its transition away from AFD and towards Related Search On Content (RSOC) and now sees profits returning to growth in 2026.

In contrast, the market appears to be discounting this recovery.

Indeed, Team Internet’s depressed share price implies no value for the Search business, assuming the remaining Comparison and Domains, Identity & Software (DIS) businesses are valued at only 7x EBITDA 2025.

We believe this implied multiple is too low for the rapidly growing Comparison division and the highly reliable DIS division.

Comparison revenue grew 43% to $63m in 2024 and Adj EBITDA margin rose to 25.6% from 20.8%, driven by more proactive marketing and advertising, new market launches and operating leverage.

In 2025, we forecast strong revenue growth continues at 24.0% with margin rising further to 27.7%, as strong organic growth continues in Germany and the division expands into new markets (Italy, Spain and France).

DIS revenue grew 7.4% in 2024 to $202.7m and Adj EBITDA margin rose to 9.6% from 6.8%, driven by the structural shift in demand towards Top Level Domains, where Team Internet has a competitive edge, and strong cost discipline.

In 2025, we conservatively forecast revenue rises 3.5% and margins rise modestly to 9.9%, supported by steady market growth and continued cost discipline.

We value the Group at 117p (99p excluding Search) based in 12x EBITDA for Comparison, 8x for DIS and 3x for Search.

Note that Zeus’ PE (5.3x) and FCF yield (17%) estimates for 2025 are not as attractive as those indicated by Capital IQ, but they would still sit in the top five lowest PEs and highest FCF yields in the sector.”

Analyst Dan Ridsdale at Edison Investment Research believes that:

“Applying modest fair value multiples for each division results in a fair value above 90p.

While the recent bid interest for the group did not materialise, we still see DIS as a potentially valuable asset.

Excluding Search returns a valuation of 68p.

We believe successful migration of revenues to RSOC will be the key catalyst for more value to become ascribed to the Search business.”

My View

Could this be the group’s saving grace?

Zeus Capital’s analysts have noted that:

“The company is considering various options to realise value for shareholders, including selling businesses, repaying debt, paying dividends or buying back shares.

The company has already received repeated offers for the DIS division.”

So, the question now is exactly what do investors do with TIG shares?

If you are just a player in the stock, then I suggest that 30% short term profits should be taken.

However, if you are prepared to gamble upon the Team Internet Group Management pulling something out of this ‘mucky’ bag, awaiting a sell-off of its DIS side – then the shares could jerk up and down within the 60p to 75p trading range.