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Why Moneysupermarket may Make you More Money than Other Comparison Websites

By Malcolm Stacey | Monday 18 September 2017

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.

Hello, Share Ticklers. Like me, you probably find comparison sites pretty useful. The savings you can make on car insurance, for example, are tasty. The first website that comes to mind is probably that annoying Meerkats one. This family benefits from its generous two-cinema-tickets-for-one deal all the time, though it can keep its cutesy market toys.

But a rival site Moneysupermarket (MONY) also scoops up a bevy of customers with its ubiquitous tv adverts and is worth a look. Time was when only car insurance featured on these sites. But now the field has widened to include homes, pets, broadband, travel, credit cards and gas and electricity deals.

The government’s cap on energy prices is said to have hit comparison sites because energy companies are not so keen now to increase their customer base. Seems an odd way to grow your utility business, but apparently that’s what’s happening.

Never mind, it looks as though Moneysupermarket could offset that snag and expand by bundling up various needs together. For example, packages that include mobile phones and electricity. Or car and home insurance.

At the beginning of last year, the shares were 365p. Now they are 319p. The dividend is nearly 3%. But the best bit about this company is that it has grown operating profits year on year since at least 2015. Steadily rising profits, as you know, beat improving revenue into a cocked hat.

I ought to mention the possibility that competition czars could also lean on comparison sites. For example, is owned by an insurer - Admiral (ADM). But Moneysupermarket should not be affected by that sort of thing, which might give it advantage.

Competitive rivalry among comparison sites is daunting, but not as daunting as all that. In my humble experience, they all offer similar deals, so it’s not really worth shopping around.

And now it's time to compare prices at the Punter’s Return.

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