Barclays reinitiates coverage on Informa, sees value in mid-curve bonds

Investing.com -- Barclays has reinitiated coverage on Informa Plc with an “overweight” rating, describing the London-listed media and events group as a “small EU Media issuer with strong fundamentals.” 

The brokerage said the company’s leadership in the business-to-business events sector, coupled with stable credit metrics and solid cash flow, supports its positive stance. 

Despite strong year-to-date performance, Barclays noted that the “belly of the curve offers value,” signaling opportunity in Informa’s mid-maturity euro bonds.

Informa , which operates in more than 150 countries and has a market capitalization of about £11.9 billion, reported £3.6 billion in revenue and £1.1 billion in adjusted EBITDA in 2024. 

The company’s leverage rose following its £1.2 billion acquisition of Ascential in October 2024, but management has pledged to bring leverage back within its 1.5-2.5× target range. 

Both S&P (BBB Stable) and Moody’s (Baa2 Stable) have maintained their ratings, reflecting confidence in the company’s balance sheet and deleveraging plan.

Barclays said Informa’s first-half 2025 results “came in slightly ahead of market expectations.” Revenue rose 20.1% year over year to £2 billion, supported by 7.8% underlying growth, while operating profit increased 24% to £579 million, lifting operating margins to 28.4%. 

Free cash flow grew 25% to £357 million, reducing net debt to £2.97 billion from £3.2 billion a year earlier.

“Informa benefits from a leading market position within the B2B events industry, underpinned by its scale and broad geographic diversification,” Barclays said. 

The brokerage added that innovations such as data-driven and digital event solutions have “enhanced customer engagement and created new revenue streams,” strengthening the group’s operating performance.

Barclays identified two bond switches favoring Informa: moving from WPP Finance 3.625% 2029s into Informa 3.375% 2031s, offering a 26-basis-point pick-up in z-spread, and from JCDecaux 1.625% 2030s into Informa 3.25% 2030s, for a 14-basis-point gain. The bank said these moves allow investors to shift into a stronger mid-BBB credit at comparable maturities.

Barclays expects continued improvement in Informa’s credit profile through 2026 as deleveraging progresses, underscoring that while merger and acquisition activity remains a key risk, Informa’s strong fundamentals and revenue visibility support its investment-grade stability.