Learning Technologies Group PLC (AIM:LTG, OTC:LTTHF) should consider a return of capital to rebuild its share price after the recent profit warning, suggests Panmure Liberum.
VectorVMS’s recent disposal highlights the potential underlying value but what unlocks that questions the broker - a return to organic growth, acquisitions or return of capital?
“With continued macro/top-line concerns, a return of capital would be the easiest lever in the short term in our view.
“The valuation metrics are too low for us, with an EV/sales multiple of 1.1x and adjusted EBIT margins in the high teens, EV/EBITDA of 5.1X, and EV/EBIT of 6.1X.
Panmure's target price comes down to 105p from 120p after the recent downgrades, but buy remains the rating.