eToro Group's stock has extended its sharp decline, hitting its lowest level since February this year. The shares have tumbled roughly 40% from their 2025 high, erasing significant market value. Technical analysis now points to additional downside as the price action forms an inverted cup-and-handle pattern.
Revenue Growth Decelerates
The sell-off intensified after eToro reported second-quarter earnings on August 10. Revenue rose 9% year-over-year to $229 million, but the pace of growth has slowed considerably due to the ongoing crypto winter. Equities trading now accounts for 60% of total volume, followed by commodities.
Customer numbers increased 18% to 4.28 million, and assets under administration climbed to $19.2 billion from $17.5 billion in the prior year. Total trades jumped over 60% during the quarter. However, these operational gains have not been enough to offset investor concerns about future growth.
According to Yahoo Finance estimates, third-quarter revenue is projected to decline 5.3% to $203.1 million. Earnings per share are expected to fall from 53 cents in Q3 2025 to 40 cents in the most recent quarter. For the full year, analysts forecast revenue of $918 million, up just 5.8% year-over-year—a pace that lags competitors like Robinhood Markets (expected 17% growth) and WeBull (over 40% growth).
Analyst Sentiment Mixed
Despite the bearish technicals, some analysts remain optimistic. Cantor Fitzgerald reiterated an overweight rating, while Mizuho's Dan Dolev maintained an outperform rating, albeit with a reduced price target from $52 to $43. Canaccord Genuity's Joseph Vafi also reaffirmed a buy rating.
The bullish case rests on valuation: eToro trades at a forward price-to-earnings ratio of 10.3, well below the S&P 500's 19.1, and its forward PEG ratio of 0.59 is also attractive relative to peers.
Technical Breakdown Points Lower
The daily chart reveals a clear inverted cup-and-handle formation, characterized by a horizontal support level and a rounded top. The handle section formed between August 8 and September 3. The stock has already broken below the pattern's lower boundary and is now approaching the critical support at $24.80, its February low.
A decisive move below that level could trigger a further slide toward $20. The stock remains below its 50-day moving average, and the Average Directional Index (ADX) has risen to 25.56, its highest since August 26—a sign that the downtrend is gaining momentum.
Investors will be watching whether the $24.80 support holds, as a break could accelerate selling pressure. The combination of deteriorating fundamentals and a bearish chart pattern suggests the path of least resistance is lower.
This article is for informational purposes only and does not constitute financial advice.
