Pearson PLC (LSE:PSON) is being talked up by JPMorgan, which argues the market has been too pessimistic about the impact of artificial intelligence on the education group.
Pearson’s shares are down 15% over the past year and the rating has slipped from around 16 times to about 14.5 times forecast 2026 earnings.
That de-rating reflects concerns about growth being heavily weighted to the final quarter and broader worries that AI could disrupt the business.
JPM takes the opposite view. It says AI should be an opportunity, not a threat. Pearson owns large volumes of trusted, verified content and can embed AI tools directly into its products.
It is also well placed to benefit from workplace disruption as demand grows for re-skilling and lifelong learning.
The bank expects growth to accelerate sharply in the final quarter of 2025, to around 8%, setting up momentum into 2026.
That should support growth above current guidance in the first nine months of next year and help rebuild confidence in double-digit earnings growth over the medium term.
JPM argues that level of growth would justify a re-rating. Its target price of 1,420p implies about 30% upside and values Pearson on roughly 17 times forecast 2027 earnings.
The bank has named Pearson as one of its key picks for 2026, alongside RELX, Universal Music Group and Publicis Groupe.
In early afternoon trading, the shares were up 1.2%.