Trade Me is in sound financial health but its revenue and profit growth is affected by economic conditions in New Zealand, Morningstar analyst Gareth James says. "Trade Me’s balance sheet is in good shape thanks to the capital-light nature of the business model and we expect to stay that way." Market responsesTHE BULLS SAY• Trade Me commands strong brand equity and its online marketplace business has a strong network effect. • A rapidly changing internet landscape may be disruptive to Trade Me’s business model. • Trade Me’s margins in the near term could come under pressure as it seeks to invest in other business to drive revenue growth.

Source: Otago Daily Times February 21, 2017 17:06 UTC