eToro Group Ltd. (ETOR) is a global multi-asset trading and investment platform that provides retail investors with access to equities, crypto assets, commodities, and currencies across 75 countries. The company went public on NASDAQ in May 2025 and positions itself as a pioneer of “social investing” through its Copy Trading feature, which allows beginners to automatically replicate trades of experienced investors in real time.
Investment attractiveness factors
· Strong 2025 financial results: revenue of $868mn (+10% y/y), above consensus of $864mn. EBITDA reached $317mn with a 37% margin (consensus: $309mn / 36%), while net income was $216mn with a 25% margin. The company continues to demonstrate strong profitability following a significant margin expansion in 2024 (EBITDA margin increased from 16% to 39%).
· Strong operational momentum in early 2026: February metrics were solid, with 70.2mn ECC trades (equities, commodities, and FX), which annualized implies 217mn trades in Q1 — significantly above analysts’ expectations of 175mn. This confirms sustained user engagement amid elevated global market volatility.
· Unique global user base with strong conversion potential: registered users total 38mn, with ~10% converting into funded accounts versus 4–6% in 2019–2020. Funded accounts have grown at a 37% CAGR since 2020, outperforming Robinhood (19% CAGR) and other peers, driven by expansion in underpenetrated European and Middle Eastern retail markets (~75% of the base). Each percentage point of conversion uplift provides significant revenue upside without acquiring new users.
· Differentiated, highly engaged business model: social trading and Copy Trading generate engagement levels far above traditional brokers. Users execute 40–50 trades per quarter, 4–6x higher than U.S. online brokerage platforms. This trading intensity offsets a relatively low average account size (~$5,500). eToro’s ARPU in 2025 exceeds that of Robinhood, despite Robinhood’s nearly twice larger average account size.
· Significant monetization upside: revenue per trade remains below $1 versus $1.5–$3 for peers. Key catalysts include: (a) derivatives rollout (options, futures) outside the U.S.; (b) development of in-house clearing capabilities; (c) expansion in the U.S. market. Execution in any of these areas could materially improve unit economics.
· Diversification from crypto to broader markets reduces cyclicality: users are increasingly shifting from crypto to equities, commodities, and FX. In Q4 2025, capital markets revenue grew 45% y/y, while crypto revenue declined 73% y/y. Reduced crypto concentration improves earnings stability and predictability.
M&A and buyback support
Management highlighted an increased likelihood of M&A activity in 2026 (precedent: acquisition of Spaceship in Q4 2024). The company also expanded its share buyback program, with $150mn remaining (~5–6% of market cap). Active buybacks at a meaningful discount to IPO price signal management confidence in intrinsic value.
Target price: $43