This analysis highlights Opera Limited as a compelling investment following a significant market downturn. The recent dip in its stock price, reaching lows around $12, has created an attractive entry point, offering investors an improved safety margin and a deep value proposition. Despite some near-term pressure on profit margins due to rising inventory expenses, the company's revenue growth is robust, primarily driven by strong performance in its advertising segment, especially within e-commerce. The stock's current valuation, characterized by a favorable forward price-to-earnings ratio and a solid dividend yield, suggests a promising outlook. Analysts are optimistic about future earnings per share and revenue growth, reinforcing the company's potential for long-term capital appreciation and solid returns.
Opera Limited has consistently demonstrated resilience, having previously navigated market volatility to maintain an upward trajectory since late 2022. Even when facing expected corrections, such as the one discussed in August 2025, the company's stock has shown an ability to establish and defend support levels. This historical performance provides a degree of confidence in its capacity to rebound from current challenges, given its fundamental strengths and market positioning. The underlying business drivers, particularly in the rapidly expanding digital advertising landscape, continue to provide a strong foundation for future growth.
The company's financial metrics underscore its attractiveness. Trading at a forward P/E ratio of 11.73x and a 2-year non-GAAP PEG ratio of 0.53x, Opera Limited appears undervalued relative to its growth prospects. Furthermore, the impressive forward dividend yield of 5.73% adds another layer of appeal for income-focused investors. These figures collectively paint a picture of a company with strong financial health and a commitment to shareholder returns, making it a standout option in the current market climate.
Looking ahead, consensus estimates project a compounded annual growth rate of 14.6% for revenues and 22.1% for adjusted earnings per share over the next two years. These projections are supportive of a substantial long-term upside potential, with a bullish price target set at $36. Such growth forecasts, coupled with the company's attractive valuation and robust dividend, indicate a favorable risk-reward profile for investors considering Opera Limited.
In conclusion, the current valuation and future growth prospects of Opera Limited, particularly after its recent share price adjustment, position it as an attractive investment. The combination of strong advertising revenue growth, a discounted valuation, and promising analyst forecasts suggests significant potential for both capital appreciation and income generation, making it a compelling consideration for discerning investors.