Citi Research upgraded events and publishing group Informa Plc to a "buy" rating from "neutral" on Friday and raised its 12-month target price to 990 pence from 850 pence. The broker said the revision was driven by the UK government's decision to remove its travel advisory against the United Arab Emirates and Saudi Arabia.
Citi linked the change in UK travel guidance to a memorandum of understanding announced this week between the United States and Iran relating to ending the Middle East conflict. The broker added that it believes the UK move is likely to be followed by other governments, increasing the probability that planned events in the Middle East and Africa will proceed.
"We think the UK change in advice is likely a precursor to other governments following suit," the analysts wrote. Citi had earlier highlighted government travel advice as a determinant for whether remaining Informa events in affected regions would go ahead. With that uncertainty reduced, Citi said it reverted to its prior valuation approach.
Specifically, the broker moved back to a 60/40 weighting between a target price-to-earnings multiple and a discounted cash flow model, reversing a temporary 70/30 split. Citi also raised its target multiple to 15.5 times average fiscal 2026 and 2027 estimated adjusted earnings per share, up from 12.5 times. The broker described the 15.5x multiple as consistent with the stock's three-year pre-conflict trading average.
The 990 pence target is composed of a target P/E valuation of 962 pence and a DCF valuation of 1,026 pence. Citi used a weighted average cost of capital of 10.3% and a terminal growth rate of 2% in the DCF component.
Citi did not alter its financial forecasts in connection with the rating change. The broker projects Informa's sales will rise to 4.36 billion in fiscal 2026 and 4.68 billion in fiscal 2027. Adjusted core earnings per share are forecast at 57.6 pence in 2026 and 66.6 pence in 2027, which implies year-on-year adjusted EPS growth of 15.6% in 2027 on Citi's numbers.
On those forecasts, Citi noted the stock trades at roughly 13 times fiscal 2027 estimated earnings. The analysts also cited Visible Alpha consensus data projecting 16% adjusted EPS growth in fiscal 2027, and referenced Informa management commentary at a recent AGM trading update pointing to further strong growth in 2027.
Citi outlined several risks that could alter its view. These included weaker-than-expected revenue growth in Informa's live events division, a potential re-emergence of tensions in the Middle East, unexpected developments within academic publisher Taylor & Francis, and uncertainty in the B2B marketing market and around TechTarget's performance. Each of these could affect revenue and earnings outcomes relative to Citi's base case.
The rating upgrade and higher target multiple reflect an easing of event execution risk in the Middle East and Africa, but Citi's unchanged forecasts and identified downside scenarios indicate the broker still sees material event- and publishing-related uncertainties that investors should monitor.