Latest news with #Ascential
Yahoo
25-05-2025
- Business
- Yahoo
1 FTSE 100 stock to consider buying right now
The FTSE 100 currently trades at an average price-to-earnings (P/E) ratio of around 16. But I think investors should take a close look at a stock that's trading at a much higher multiple. Informa (LSE:INF) isn't exactly a household name and its shares don't exactly look cheap at first sight. But I think there's a lot to like about the business from an investment perspective right now. The largest part of Informa's business is its events division. The company organises conferences and trade shows for various industries around the world. From an investment perspective, there's a lot to like about the business model. It avoids maintenance costs by leasing venues and it charges attendees before the event. Costs are then payed after. Source: Informa 2024 Results The firm's events, such as Cannes Lions, are the biggest and best in the industry. This makes them important places for businesses to network, do business, and learn so attendance is crucial. Informa's strong assets create durable demand and its low overheads result in high cash flows. But there's a particular reason I think the stock's more attractive right now than it first seems. Officially, Informa shares trade at a P/E ratio of around 36, which makes it look like a strong business with a premium price tag. But I think a closer look reveals a somewhat different picture. After several acquisitions over the last few years (including Ascential), the firm's income statement has featured significant non-cash expenses. Officially, these have been weighing on net income. In terms of cash however, things look much more positive. Informa's free cash flow reached around £770m in 2024, which is just over 7% of the company's market value. The FTSE 100's returning a lot of that cash to shareholders via dividends and share buybacks. And that makes me think the stock actually looks like pretty good value here. I think Informa's a quality operation with some very attractive properties. But there are some important risks that investors ought to pay attention to. The biggest, in my view, is a potential trade war. This is arguably the main threat to the stock market as a whole at the moment, but it's especially important for a company focused on global trade events. A recession could cause businesses to cut back their spending and potentially weigh on Informa's revenues. But to some extent, this is something that the company has seen before. Demand fell away sharply during the Covid-19 pandemic as in-person events were suspended. But it rebounded strongly after, illustrating the long-term resilience of the company. A high P/E ratio and potential vulnerability to an economic downturn makes Informa shares look expensive. But I think the stock's more attractive than it first seems. Based on the cash the underlying business generates, the stock looks reasonably priced and the business has shown itself to be resilient over time. So I think it's well worth considering. The post 1 FTSE 100 stock to consider buying right now appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Stephen Wright has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025
Skift
06-05-2025
- Business
- Skift
Informa's $584 Million Bet on Festival Brands
Informa's $1.6 billion acquisition of Ascential was all about Cannes Lions and Money20/20. While the events drive significant revenues, Informa values the brands alone at more than half a billion dollars. Informa's plans for the Cannes Lions and Money20/20 franchises are taking shape following its acquisition of them last October for $1.6 billion. They now fall under the new Informa Festivals division, along with other 'experience-led' events, across five industry sectors: marketing, fintech, cyber security, gaming, and tech, which accounts for 10% of the company's revenue. Informa's 2024 annual report reveals a calculation of the non-physical assets acquired from Ascential, attributing $584.3 million (£439.6 million) to the Cannes Lions and Money20/20 brands alone. It also attributes a value of $164.3 million (£123.5 million) to acquired customers and $18.6 million (£14.0 million) to data. In December, Informa announced a new Money20/20 Middle East launching this September, powered by Tahaluf, its joint venture in Saudi Arabia. This is the third expansion of the franchise whose flagship event remains in the U.S. With the event already successfully cloned in Europe and Asia, the Middle East was a natural next step following the popular geo-cloning format. In April, Cannes Lions announced its 2025 Awarding Jury line-up, highlighting increased representation from Africa, Asia, and the Middle East. Informa Festivals currently draws 85% of its revenue from Europe and North America, leaving significant expansion opportunities. Overall, Informa's revenue split is 49% North America, 17% Europe, and 34% elsewhere. While geo-cloning is a strong strategy, there are plenty of cases where global expansion is not successful for business festivals. C2 pulled the plug last minute on its launch of a Melbourne (Australia) edition, despite significant backing from the destination. SXSW was able to successfully launch SXSW Sydney in 2023 and returned for a sophomore event last year. However, the organization recently had a major shakeup and a fresh round of layoffs. It has not shown any signs of backing out of the launch on June 2 of SXSW London, but success for its European franchise is far from guaranteed. A Profitable But Demanding Business Model Informa appears bullish on 'experience-led' events, but justifying high prices requires substantial investment and high production value. Already pre-pandemic, the premium paid by brands to be at Cannes Lions had attracted criticism from some of the world's largest advertising agencies, which blamed consumer tech brands for pricing creative companies out of the festival. Revenue from brand partnerships is not public, but a sample of the Cannes Lions partnership opportunities offered for 2024 include static banners on the exterior of the venue for just under $80,000 (€70,000); branding a coffee cart for $170,000 (€150,000); and a 25% share of airtime on the 'Big Screen' (a large digital display above the red carpet entrance) for a whopping $220,000 (€195,000.) In contrast, the Platinum sponsorship package for CES' Digital Health Summit is priced at $50,000. Attendees also pay a premium to be at Cannes Lions, with the 2025 walk-up rate set at $4,869 (€4,295). VIP experiences start at $7,167 (€6,345), and a student pass costs $1,128 (€995). There is even a 'Connector Pass' price at $672 (€595), offering only access to the festival's mobile app for networking, but no access to content. Money20/20's USA event is also on the pricey side of the market. Standard passes for the October show are currently priced at $3,499, going up to $4,099 on May 16. Startups, non-finance retailers, government entities and nonprofits can buy discounted passes starting from $1,495. According to Ascential's 2023 annual report, delegate passes generated $34.6 million (£26.1 million) from the two franchises. In contrast, SXSW's walk-up rate for its 'Platinum' badge granting access to all events was $2,295 for 2025, and the organization has announced it will lower ticket prices for the 2026 edition. Attending Salesforce's Dreamforce costs $2,299 and ticket prices for C2 Montréal are even more affordable, with a full-access 'C2 Experience' pass priced at $1,300 (CA$ 1,795). Awards Built on Brand Partnerships Awards are also a big money maker for Cannes Lions, with entry costs ranging from €675 to €2,765. Last year the organization said it received 26,753 award entries. The previous year, Ascential made $41 million (£30.9 million) in revenue from these awards alone. Informa has replicated the same formula for Money20/20, with the fintech brand launching a new series of awards just last month. The Money Awards has a fee structure similar to Cannes Lions, starting at $699 and going up to $2,659. For now it has only five categories; Cannes Lions has 30. Business Festivals Model May Face Geographical Barriers While the model has seen success in the U.S. and Europe, the high ticket price may prove to be a barrier to global expansion. The 'Standard Pass' for Money20/20 Middle East costs $2,750, with an early bird promotional price of $1,375. The price is set significantly lower than Money20/20 Europe, which offers a 'Standard Pass' at $4,411 (€3,895). Seamless Middle East Fintech, a competing trade show run by Terrapinn, offers a 'Free Event Pass' with full access to the trade show and conference sessions at no cost. The show also offers a 'Premium Networking Pass' costing $3,000, which adds networking opportunities in lounges and in the event app. Leap, a tech show born in the Middle East under the Tahaluf brand, offered a free visitor pass limiting entries to after 1pm, and a Delegate pass priced at $800 ($400 early-bird rate) for its 2025 edition. GITEX Global in Dubai, a larger show in line with CES, offers a $123 (AED450) 'Visitor Pass.' With the Cannes Lions and Money20/20 brands representing over a third of the total $1.6 billion Ascential acquisition price, Informa appears confident that the business festival will translate globally, even if the financial model may require geographical adjustments. It is looking to leverage its global presence, cross-sector reach, and powerful media assets to ensure its festivals division becomes a significant revenue generator.
