It’s one step back, two steps forward for the Daily Mail Group (LON:DMGT) following its sale of a chunk of holding in Euromoney according to Liberum.
The backward move is the reduction in earnings per share over the next two years by 19% and 24% respectively, but the positive for the broker is that management has made it clear that they are looking to reorganise the portfolio.
“We believe that we are going to see a re-rating of the stock as it is clear that management is going to reorganise the structure of the portfolio thus recognising the true value.
"DMGT previously funded acquisitions through disposals but going forward they will fund acquisitions through operating cash flow generation, which may indicate the businesses it will now prioritise.
“On a SOTP (sum-of-the-parts) basis we value the shares at 900p [950p], which implies a c.15% upside to the current share price.”
'Buy' is its view. Shares today were 773p.