Ascential rally has 'gone too far' worries Barclays
(ShareCast News) - Sceptical of a 40% rise in its shares since the start of the year, Barclays has initiated coverage of events and exhibitions organiser Ascential with a cautious note, an 'underweight' rating and a 330p price target.
While acknowledging strong results last year, the removal of overhang from original sponsors, and the successful print disposal, as ample reasons for the strong re-rating since the IPO, Barclays viewed the price surge as having "run too far".
Analysts warned of "further risks" at Cannes Lions and Medialink as ad agencies suffer, also worrying about the cyclicality in the business that does not seem to be in the price.
Finally, Barclays three valuation methodologies all point to downside to the current price.
"Beyond Cannes, we cannot point to major "cracks" in the story," the analysts admitted. "But with exposure to a handful of assets, and sentiment positive, we see unfavourable risk/reward."