It’s been an excellent yr for the Trustpilot (LSE:TRST) share worth. The FTSE 250 inventory has rocketed by 120% over this era and at the moment sits at 190p. A giant a part of this was sturdy monetary outcomes, with the enterprise lastly pivoting to turning into worthwhile in 2023. But with the share worth persevering with to march on, worth targets are continuously being exceeded.

What the consultants assume

Most high banks and brokers have analysis groups that examine shares and put out their very own share worth forecasts. Most are set with a 12-month time horizon.

A number of analysts have been scrambling to maintain up with the efficiency of Trustpilot over the previous yr. For instance, the group at JP Morgan had a goal worth of 140p this time final yr. This was elevated to 190p late final yr and is now at 250p. This means additional positive aspects might be attainable for the corporate.

One other case is Peel Hunt. This time final yr the forecast was set at 165p. It was elevated at first of this yr to 200p however has been raised once more following the 2023 outcomes from March. The present forecast is 250p.

In truth, from the entire share worth forecasts that I can see, no main financial institution or dealer has a goal under 190p (which is roughly the place the inventory at the moment trades).

Basic positives

I don’t need to merely purchase a inventory as a result of it has a whole lot of constructive forecasts on the market. These are simply worth predictions and don’t have any assure of being appropriate. That’s why I’ve to take them with a pinch of salt.

With that being stated, if my view agrees with different traders on the market, it’s a giant tick within the field when contemplating whether or not or to not purchase.

My constructive view on the inventory is predicated round the truth that the agency has efficiently reached a giant pivot level. That is the truth that after years of losses, it posted a $7.1m revenue for 2023.

The enterprise has been steadily rising income for years, however working prices prevented it from attending to a revenue after tax. Nonetheless, it has now reached some extent whereby income is sufficient to cowl this. Continued development in web site site visitors has helped right here. For instance, month-to-month distinctive customers on the platform rose 30% versus 2022.

Factors to recollect

Although I believe the inventory might outperform over the approaching yr, I’m barely cautious. After all, any inventory that has risen a lot in such a brief time period has the potential to ‘appropriate’ decrease as traders look to financial institution some revenue.

I’m additionally conscious that there’s a cap on how massive Trustpilot could be within the present kind. A evaluate web site is an effective enterprise concept, but it surely’s not going to be the following member of the trillion-dollar market cap membership!

Even with these dangers, I’m critically contemplating including it to my portfolio and really feel traders ought to think about doing the identical.