Jefferies downgrades Moneysupermarket, slashes price target

"We see no near-term catalysts, and relative valuation metrics point to fair value," it said.

The bank said it expects growth in insurance, which makes up about 50% of revenue, to decelerate in 4Q23 and throughout FY24 as the group laps tough comps and car insurance premium disinflation takes hold.

"We agree with the 'Retain and Grow' strategy, but we believe it warrants a wait-and-see approach," Jefferies said.

It said the loyalty programme - 'SuperSaveClub' - and better use of firstparty data via the integrated 'Dialogue' platform should increase consumer stickiness and gradually decrease customer acquisition costs (CAC).

This should pave the way for revenue growth via increased cross-selling and margin expansion via lower CAC, it said.

"However, we are aware that it is still early days; we lack the proof necessary for full confidence in the success of the strategy, especially considering the industry's long-run structural issues, namely low growth and high competition."

At 0930 GMT, the shares were down 6.8% at 250.40p.