Freedom Holding Corp. (NASDAQ:
FRHC) has emerged as a standout performer in the financial services industry,
demonstrating impressive growth and strong financial results. Despite a slight
decline in earnings per share (EPS), the company has more than doubled its
revenue year-over-year, reflecting its expanding market presence and strategic
execution. With a stock price that has surged nearly 95% over the past year,
significantly outperforming the S&P 500, Freedom Holding continues to
attract investors looking for high-growth opportunities. FRHC stock is up
38.21% since my analysis in November 2024. In this article, we will analyze the
company’s recent financial performance, stock valuation, growth potential, and
potential risks to determine whether FRHC remains a solid investment choice.
About Freedom Holding Corp
Founded in 2008 by Timur Turlov,
Freedom Holding Corp. is a diversified financial services company headquartered
in Almaty, Kazakhstan, with administrative offices in Cyprus and the United
States. The company operates through several subsidiaries, offering a broad
range of services, including retail securities brokerage, investment research,
investment counseling, securities trading, market making, corporate investment
banking, underwriting, and insurance. Freedom Holding is a member of major
exchanges such as the New York Stock Exchange (NYSE) and NASDAQ, and it
maintains a strong presence in Central Asia, Europe, and the U.S.
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Freedom Holding Financial
Performance
Freedom Holding Corp. delivered a
remarkable performance in its Q3 2025 earnings report, showcasing strong
revenue growth despite a decline in earnings per share (EPS).
For the quarter ending December
2024, the company reported revenue of $520.11 million, more than doubling the $248.59
million reported in Q3 2024. This represents a 109.23% year-over-year (YoY)
increase, reflecting Freedom Holding’s ability to scale its business operations
and expand its market presence.
However, earnings per share (EPS)
for Q3 2025 declined by 20.86%, coming in at $1.29 compared to $1.63 in Q3
2024. This decrease was likely due to increased operational expenses and
investments in growth initiatives, which may weigh on short-term profitability
but could contribute to long-term expansion.
On a trailing twelve-month (TTM)
basis, revenue growth remained strong, reaching $1.57 billion, a 79.07%
increase compared to $881.32 million in Q3 2024. However, EPS (TTM) slightly
declined from $5.65 in Q3 2024 to $5.36 in Q3 2025, a 5.28% drop, indicating
some pressure on profit margins despite rising revenues.
A major highlight of the quarter
was the significant improvement in free cash flow per share (TTM), which surged
to $9.82 from -$32.14 in the previous year. This turnaround demonstrates the
company’s improving cash flow generation, which is a positive sign for
long-term financial stability and shareholder value.
Despite some short-term
profitability challenges, Freedom Holding’s strong revenue growth and cash flow
improvement indicate a solid foundation for continued expansion and financial
strength in the coming years.
FRHC Stock Price Performance
and Valuation
Over the past year, Freedom
Holding's stock price has experienced remarkable growth. As of February 8,
2025, the stock was trading at $157.56 per share, representing a 94.9% increase
over the past year, significantly outperforming the S&P 500's 20.6% gain
during the same period.
In terms of valuation, the
company's price-to-sales (P/S) ratio on a trailing twelve-month (TTM) basis
stands at 5.94, the price-to-earnings (P/E) ratio is 29.42, and the
price-to-free cash flow (P/FCF) ratio is 16.15. These metrics suggest that,
despite the substantial stock price appreciation, Freedom Holding remains
reasonably valued, especially considering its robust revenue growth and
improving cash flow generation.
Freedom Holding Growth
Potential
Freedom Holding is
well-positioned for continued growth, supported by several strategic
initiatives and favorable market dynamics. The company's expansion into new
markets, such as the recent acquisition of EliteCom, a telecommunications
services company, for $3 million, indicates its commitment to diversifying its
service offerings and revenue streams. The acquired licenses and assets will be
used to develop Freedom Holding's own telecommunications business, potentially
opening new avenues for growth.
Furthermore, the company's strong
presence in emerging markets, particularly in Central Asia and Eastern Europe,
positions it to capitalize on the increasing demand for financial services in
these regions. As these economies continue to develop, the need for
comprehensive financial solutions is expected to rise, providing Freedom
Holding with significant opportunities to expand its client base and service
offerings.
Risks to Consider
While Freedom Holding's growth
prospects are compelling, investors should be mindful of certain risks. The
company's operations in emerging markets may expose it to geopolitical
uncertainties, regulatory changes, and economic volatility. Additionally, the
recent increase in expenses, if not managed effectively, could pressure profit
margins in the future. However, Freedom Holding's strategic initiatives and
diversified business model provide a solid foundation to navigate these
challenges and continue delivering value to shareholders.
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Conclusion
Freedom Holding Corp.'s
impressive revenue growth, strategic expansion initiatives, and strong stock
performance underscore its potential as a compelling investment opportunity.
While mindful of the associated risks, the company's diversified service offerings
and presence in high-growth markets position it well for sustained growth.
Investors seeking exposure to a dynamic financial services firm with a track
record of performance may find Freedom Holding an attractive addition to their
portfolios.
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