Informa PLC (LSE:INF) was downgraded to a ‘sell’ from ‘neutral’ by UBS ahead of upcoming 10-month results that analysts expect to be a catalyst for downgrades.
The exhibitions and events group, which slumped to huge losses last year as it took wholesale write-downs on events cancelled due to the COVID-19 pandemic, has started to recover this year.
In April, Informa said that according to their forecasts they envisage cash flows to return to pre-pandemic levels by 2025.
But the 2021 travel recovery has been slower than the market expected, UBS noted.
The UBS analysts said the general market consensus is implying a recovery in international revenues to approximately 60% of 2019 levels in 2022 but based on various data points, UBS believes this is too optimistic and 47% is more realistic.
In the note, which was issued on Wednesday, UBS cut its price target from 540p to 535p, 4% below the close price later in the day.