Moonpig (LSE:MOON) shares are trading at a 9% free cash flow yield that one analyst describes as "crazy cheap" for a business of its quality, with the broker reiterating a Buy rating and 300p price target after what it called "cracking numbers" from the online greetings card and gifting group's full-year results.
The analyst argues the valuation disconnect is the core of the call, pointing to a cash returns profile, encompassing a 25% dividend increase and a £60m buyback completed in FY26, that few peers in the consumer internet space can match.
Moonpig reported FY26 revenue up 6.5% to £373m, adjusted EBITDA up 8.1% and adjusted earnings per share up 19.5%, driven by order volume growth of 2.1% and average order value expansion of 5.7%, with free cash flow rising 12% and early FY27 trading in line with expectations.
The analyst flags no change to FY27 estimates as the decisive signal: stable guidance from a business generating this level of cash and still re-rating toward fairer value is, in the broker's view, the catalyst the Buy thesis hangs on.
