Will Shares In Informa PLC Outperform Vodafone Group plc, BT Group plc, Pearson plc And ITV plc After Results?

Are shares in Informa PLC ORD 0.1P (LON:INF) (LSE:INF.L) more appealing for investors than those in Vodafone Group plc (LON:VOD) (LSE:VOD.L), BT Group plc (LON:BT.A) (LSE:BT.A.L), Pearson plc (LON:PSON) (LSE:PSON.L) and ITV plc (LON:ITV) (LSE:ITV.L)?

Informa PLC ORD 0.1P
Informa PLC ORD 0.1P

Shares in Informa PLC (LON:INF) (LSE:INF.L) have risen 1.5% today after the release of 2016 results to the stock market. Informa’s revenue increased 11% to £1345.7 million, with 1.6% of it being organic growth. Adjusted operating profit increased 13.8% to £416.1 million, which caused a 6.6% rise in adjusted diluted earnings per share to 42.1p.

This improved performance meant Informa increased dividends per share by 4.3% to 19.3p. Its balance sheet and FCF have remained robust in my opinion. FCF was £305.7 million compared to £303.4 million in 2015, while net debt/EBITDA was 2.6x including the £1.2 billion Penton addition.

2016 saw Informa’s shares benefit from steady growth, with the business growing on all key financial measures. It also expanded significantly in the USA and invested in its products. In my view, this should enable Informa to make further improvements on its earnings in future years.

The Penton integration is on track, with the Discovery and Delivery phases nearing completion. Informa is three quarters of the way through its Growth Acceleration Plan and organic growth investment may be starting to deliver, with 30+ enhanced products set to come on stream in 2017/18.

Its international expansion is also progressing, with a 4-year programme of targeted organic and inorganic expansion in the USA having the potential to improve Informa’s share price performance in my view.

In the year-to-date, Informa’s shares have risen 1%. That’s ahead of the share price performance of other TMT sector shares such as Vodafone Group plc (LON:VOD) (LSE:VOD.L), BT Group plc (LON:BT.A) (LSE:BT.A.L), Pearson plc (LON:PSON) (LSE:PSON.L) and ITV plc (LON:ITV) (LSE:ITV.L). Pearson’s shares are 17% lower, ITV has fallen 1%, Vodafone’s share price is flat and BT’s shares are 9% lower.

In my view, Informa’s shares could perform well on a relative basis in the long run. I like its growth strategy and think it could help the company to become more profitable. I’m optimistic about the prospects for Vodafone and ITV, and think BT and Pearson could become turnaround shares in the long run. But I think Informa’s shares will continue to hold their own against other TMT stocks and the company’s 2016 results seem to be positive on the whole for investors.

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