Our target price of $19 per share is based on an even weighting of our projected DCF ($19, using a 11% WACC and 3% terminal growth rate), 2026E EV/Revenue multiple (1x), and 2026E EV/EBITDA multiple (7x), relatively in-line with their 2-year EV/Revenue average of 1x and  EBITDA of 8x. 

This stock is High Risk based upon our quantitative model, but assigning a High Risk rating is not supported by the company's fundamental and financial profile, in our view.


Downside risks to our target price include: 1) a prolonged economic downturn, particularly related to the residential real estate market, which Angi’s services have historically partially been tied to; 2) continued challenges to SEO, leading to less organic traffic and higher marketing spend; 3) continued optimization for profitable growth leads to extended headwinds to topline growth; and 4) increased competition from other platforms such as search engines, marketplaces, and social media sites.


Upside risks to our target price include: 1) growth headwinds are less pronounced and Angi returns to positive growth prior to its 2026 target; 2) With the spin-off from IAC, this should  improve trading liquidity along with providing it with more options on capital allocation to provide shareholder value; and 3) margins expand faster than expected given the cost rationalization undertaken, particularly if revenue sees faster-than-expected acceleration.