Informa PLC (LON:INF) shares took an extra hit on Monday as Deutsche Bank downgraded its rating as analysts observed an increasing number of events postponements.
The German bank cut its rating to ‘hold’ from ‘buy’ and its share price target to 715p from 1,050p.
READ: Coronavirus cancellations “could have a knock-on effect into 2021” for events sector
With trade fairs and exhibitions generating almost two-thirds of Informa’s operating profit, Deutsche’s analysts said they had been tracking the pipeline of the events industry as coronavirus spread around the world.
The analysts said they “have found an increasing number of shows being postponed”.
With most China-based shows scheduled for the first quarter pushed back, Informa has also put on hold its flagship health & nutrition show in the US and the Japan edition of the important series of CPhI events.
“With the rapid rise in the number of infections, we see a material risk of extended business disruption,” the analysts said.
Doing the workings on the potential impact for the FTSE 100 group’s financials, they said their earnings per share forecasts will fall by 20% in 2020 and in a “bear case scenario” could fall over 30%.
“With a lack of visibility, risk of downgrades and further de-rating in the short term, we downgrade the stock,” the analysts added.
Informa shares fell 16% to 500p in early trade on Monday, close to a five-year low, before coming back to 545.6p by mid-morning.