‘What next for agent shareholders of OnTheMarket’ asks City analyst

City analyst David Reynolds (main picture) has predicted that more OnTheMarket agents could sell their shares if the price goes up.

OTM announced last week that 1.9 million shares owned by agents, or 2.5% of the company’s total stock, were being offloaded, saying such a low number was proof the vast majority of agents have confidence in the portal.

The announcement followed the end of a five-year ‘lock-in’ period – OTM floated on the AIM market in 2018. A further 1.2 million were released by product and technology director Morgan Ross. Institutional investors bought the 3.1 million shares on offer, 4% of the company, for around 76p each.

The company described it as “a very small number” of shares being sold. There are 75 million shares, with 35 million being owned by a range of estate agents.

Significant number

Reynolds, an equity analyst with Davy Research, says: “It is potentially good news, but may not be. The 3.1 million shares sold could have been a lot bigger, but it is still a significant number.”

Many agents may be waiting for the share price to go back up, just six months ago it was £1.30, he says.

Correction: OTM have contacted The Neg to point out that six months ago its share price was 94p, having only previously attained £1.30 in January 2021.

“They are not of the woods yet, and 2023 could be very difficult for OTM,” he adds.

Jason Tebb, CEO at OTM, said at the time of the share sale: “Agents are at the heart of everything we do and we are pleased that an overwhelming majority of them have chosen to continue to support OnTheMarket, and remain as shareholders for the next stage of our journey.

“Our strategy to become a tech enabled property business is working and we are making significant progress. We continue to have a unique position as a majority agent-owned business and look forward to working with agents to continue to develop our offering in the future.”