BofA upgrades Baltic Classifieds, backs Scout24 for steady growth

Investing.com -- BofA Securities has upgraded Baltic Classifieds Group (LON:BCG) to “buy” from “neutral,” pointing to an attractive entry point following a recent sell-off. 

The brokerage cited transitory market headwinds and reaffirmed BCG’s long-term fundamentals, highlighting its exposure to early-stage markets and a strong competitive position.

It expects a 17% five-year EPS CAGR and values the stock at 32x CY25E P/FCF, calling the modest discount to peers appealing.

Among peers, Scout24 remains BofA’s preferred name in the classifieds sector. The bank reiterated its “buy” rating, supported by consistent growth momentum and the potential for full-year guidance to be revised to the upper end of the current range. 

Scout24 trades on 33x CY25E P/FCF, a level BofA sees as justified by its faster, more sustainable growth compared to mature peers.

RELX remains a top pick across the broader sector and is part of BofA’s “25 stocks for 2025.” 

The bank forecasts 8% underlying revenue growth in the company’s Legal division for the first half of the year, driven by last year’s second-half international launch of Lexis+ AI and the early 2025 rollout of Protégé. 

A recent partnership with Harvey was viewed as reinforcing RELX’s edge in legal tech, though investor views remain split. The stock trades at 21x CY25E EV/EBITDA, below the >25x peer average.

For Informa (LON:INF), BofA expects a steady first-half print and sees scope for an upsized buyback beyond the current £200m+ minimum. 

The stock trades on a CY25E free cash flow yield of around 8%, which BofA said remains deeply discounted and in line with major agencies.

Wolters Kluwer (AS:WLSNc) and Pearson (LON:PSON) are expected to show less near-term momentum. BofA maintained a "buy" rating on Wolters Kluwer despite a roughly 20% de-rating from its peak, as investors question the sustainability of growth. 

The brokerage anticipates a reiteration of mid-single-digit EPS growth and a step-up in Health division performance in the second half as comps ease. The stock is valued at 18x CY25E EV/EBITDA, compared with peers at around 21x.

Pearson, rated “neutral,” is expected to lag until more concrete signs of second-half acceleration materialize. BofA said the upcoming results are unlikely to fully resolve ongoing market concerns.