Group on track to meet expectations of 3.5% revenue growth.
Informa amid top rising FTSE stocks today following solid trading update
- Publishing and events organiser remains confident as it trades in line with full-year expectations
- Shares are up 2.8% this morning off the back of the news of solid revenue growth and confident outlook in an environment typically viewed with uncertainty.
- We continue our ‘buy’ recommendation for investors who are looking for a balanced return and willing to accept a medium level of risk.
One of the less well-known FTSE 100 constituents, Informa, is rising up the FTSE this morning as it is up 2.8% in early morning trading following on from a trading update. The share price has been on a rollercoaster ride year-to-date with shares down over 15% since July..
The group publishes journals and books, and provides business information services to its subscribers. It has four business segments and its publishing sectors operate under the Taylor & Francis and Routledge trademarks.
Earlier in the year it completed the acquisition of UBM and the initial phase of the integration was completed on schedule. This resulted in the group becoming the world’s largest B2B events group. We welcomed this takeover since the two groups have complementary geographic and business portfolios which will enable economies of scale and cost synergy savings.
The group remains on track to meet expectations for the year with a target for underlying revenue growth of 3.5%+. Underlying revenue, excluding UBM, rose by 4.1% over the ten month period while the addition of UBM contributed to the group’s 31.8% year-on-year increase in revenues in the first 10 months of the year. Forward visibility is also strong with over 60% of forward revenue already booked or recurring.
Investors who have been bombarded with Brexit thoughts should note that with its large international footprint Informa views its related risks as being low, although the CEO also mentioned other potential clouds, most particularly the China / US trade war and Middle East political tensions. Nonetheless, he maintained that the group’s strong positions in the US, Asia and the Middle East, leaves it in well placed position to meet expectations.
Overall, we remain positive helped by cost synergies and the strength of some of its underlying markets and we continue with our ‘buy’ recommendation for investors who are looking for a balanced return and willing to accept a medium level of risk.
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