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Investing.com -- JP Morgan downgraded Informa (LON:INF) TechTarget (NASDAQ:TTGT) to Underweight from Neutral and slashed its price target to $8 from $18, citing disappointing results, limited near-term catalysts and lackluster growth prospects.
Shares of the company have dropped more than 60% year-to-date, falling from around $18 at the start of 2025 to near $7, underperforming the S&P 500’s 2% gain.
The downgrade follows the delayed release of FY24 results on June 4, which showed adjusted EBITDA of $82 million, roughly 18% below JP Morgan’s estimate.
While FY25 guidance implies flat revenue and modest EBITDA growth, the bank sees little evidence of a near-term turnaround.
“We do not see TTGT as having attractive near-term investment characteristics,” JP Morgan analysts wrote, noting management expects revenue declines in the first half of 2025 before a possible recovery later in the year.
The firm said it lacks confidence in Informa TechTarget’s ability to consistently deliver even low single-digit growth.
Although the company operates in a relatively healthy macro environment, the weakness in IT sales and marketing budgets, which its business depends on, remains a drag.
JP Morgan also highlighted a recent disclosure that the stock’s sharp derating triggered impairment testing, with the company now expecting a non-cash goodwill charge in Q1 2025.
While acknowledging the value of the company’s proprietary data assets and the scale from the Informa-TechTarget combination, analysts said visibility into revenue synergies remains limited.
A more constructive stance could emerge if end-market conditions improve or the firm pivots to a more defensive growth strategy.
The new $8 price target implies a 6x EV/EBITDA multiple on 2026 estimates, in line with peers in cyclical software.