Berenberg reinitiates coverage of Informa at 'buy'

Berenberg reinitiated coverage of Informa on Tuesday with a ‘buy’ recommendation and 820p price target.

"As a live events organiser and publisher, it is impossible to discuss Informa’s fortunes in recent years and current trends without mentioning the Covid-19 pandemic," the bank said. "Informa’s revenue nearly halved in 2020, and the company had to cancel the dividend and launch a £1bn equity issuance.

"However, Informa is now emerging as a different company than the one that entered 2020. Through well-executed M&A, management has refocused the company on its core areas of live trade events and academic publishing."

Berenberg noted the company’s £1bn buyback, and the Growth Acceleration Plan 2 (GAP 2), launched in late 2021, which it said has also accelerated Informa’s shift into digital services and should support longer-term growth.

"As growth starts to normalise following the post-Covid-19 recovery, we still anticipate 4-5% organic revenue growth into the medium term, meaning that valuation metrics become more appealing if investors are willing to look just a few years out," it said.