Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on RELX PLC. We currently have 10 research reports from 2 professional analysts.
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Frequency of research reports
Research reports on
Another positive financial performance in FY16
23 Feb 17
As expected, RELX produced satisfactory FY 16 results, with organic revenue growth positively accelerating to +4% (FY15 at +3%). Consolidated revenues reached £6,895m (+15%) after a total forex impact of +11%, reflecting the weakness in sterling versus both the US dollar and euro (only 7.3% of sales in the UK). The group’s adjusted OP amounted to £2,114m, up 6% organically (+16% reported) and reflecting an improving margin to 30.7% from 30.5% in FY15, although slightly under our 31% expectation. The adjusted EPS increased by 8% at CER to 72.2p (AV: 71.8p). The full-year dividend is raised 21% to 35.95p (AV at 34.8p) after a final at 25.7p from 22.3p a year earlier (as a reminder, the group had announced in August a larger than usual interim dividend primarily due to end-period forex). RELX announced a new £700m share buy-back programme for FY17e (£100m completed so far) after £700m completed in FY16 and is confident to deliver in FY17e “another year of underlying revenues, profit and earnings growth”, a positive statement although as vague as usual.
Legal solid, valuation wobbling
11 Nov 16
A presentation yesterday on Relx’s legal division was reassuring, underpinning expectations of several years of tick-up in revenue growth and margins to come from this business – albeit in line with existing forecasts. Even more interesting to us was a 5% fall in the stock price yesterday – unrelated to the presentation but driven by market rotation out of ‘bond proxy’ stocks. The shares are down 14% from the high reached in the last month. At 17x EPS (FY17E) they do not yet look cheap: but we highlight closer to £12 as an attractive entry point for what remains a fundamentally very attractive situation.
Continued exemplary execution
27 Oct 16
Another strong update from the now-metronomic Relx, maintaining its increased top line pace at the 9 month stage (+4% organic) helped by a particularly strong Q3 for transactional revenues in the Risk division. All underlying FY guidance remains intact, and we expect estimates to rise c5% catching up with current FX rates. Valuation remains the biggest risk, but does not look too stretched at c17x 17E EPS (FCF yield 5.3%, dividend 2.4%). Having moved back from Buy to Hold at around the £12 level, we are loath to upgrade again at current levels: but Relx remains a core holding in the sector.
Continuing to deliver...
18 Aug 16
RELX produced solid H1 16 results, with organic revenue growth positively accelerating to +4% (FY15 at +3%). Consolidated revenues reached £3,257m (+10% or +£293m) after a total forex impact of +5%, reflecting the sterling weakness versus both the US dollar and euro (only 7.6% of sales in the UK). Adjusted operating profit amounted to £1,003m, up 6% organically (+10% reported) and reflecting an improving 30.8% from 30.7% margin (cost control and continued process innovation impact). About £500m share buy-backs were completed over the period and a further £200m will be deployed by the end of the year. Adjusted EPS increased by 8% at CER. The interim dividend is raised 39% to 10.25p, nearly 26% above our forecasts, as the group announced a larger than usual interim dividend for RELX Plc primarily due to end-period forex. Note that the full-year dividend policy is unchanged, i.e. in line with adjusted EPS growth with a cover level at least 2x over the long term. Regarding the FY16e guidance, the statement is as vague as usual, i.e. “delivering another year of underlying revenues, profit and earnings growth”. CFO Nicolas Luff specified that, at current rates (i.e. with the dollar and the euro averaging between 10% and 11% stronger against sterling for the year as a whole), he would expect an 8% to 9% benefit to sterling-reported growth rates for the full year.
Perfectly well executed indeed
09 Mar 16
RELX produced solid FY15 results, globally in line with our forecasts, with revenues at £5,971m (+3%) after a total forex impact of only +1%, despite generating only 8% of its sales in the UK, as the strengthening US dollar versus sterling was offset by the weakening euro. The underlying revenues trend was similar to the 9-month period at +3%, once again supported by growth across the four businesses. Adjusted operating profit reached £1,822m, up 5% organically, and reflecting a solid 30.5% margin, in line with our expectations, up from 30.1% in FY14 and 90bp higher on an underlying basis. EPS rose by 7.9% and by 8% at CER to 60.5p, when we had forecast a slightly higher 63.5p. The full-year dividend per share is to be raised by 14.2% to 29.7p, while a further £700m share buy-back was announced for 2016 (coming after a £500m plan in 2015). Regarding the FY16 guidance, the statement is as vague as usual, i.e. “delivering another year of underlying revenues, profit and earnings growth”, with early FY16 trends being in line with those of FY15.
All businesses continuing to show underlying growth…
28 Oct 15
RELX produced solid first nine months trading results, similar to H1 15 trends. Underlying revenues improved by 3%, once again supported by growth across the four businesses. The group, which pursued its portfolio management over the period (14 content, data and exhibition assets acquired year to date for £91m and 11 assets disposed of for £72m) reaffirmed its FY guidance, although remaining as vague as usual, i.e. "delivering another year of underlying revenues, profit and earnings growth". Out of the £500m share buy-back plan announced for 2015, £425m has been completed so far with the remaining £75m to be deployed by year-end. It was specified that the Board will not make any decision on a 2016 share buy-back until February.
N+1 Singer - Morning Song 22-03-2017
22 Mar 17
Carador Income Fund (CIFU LN) Premium rating restored, high levels of refinancing activity | Cello Group (CLL LN) Outlook getting brighter – watch Pulsar | Eckoh (ECK LN) Largest ever US secure payments win | eg solutions (EGS LN) Full year results in line | Futura Medical (FUM LN) Licensing deal for CSD500 in Portugal | Verona Pharma (VRP LN) Global agreement with QuintilesIMS to support development of RPL554 | Xaar (XAR LN) 2016 results slightly ahead, reduced visibility in 2017
10 Mar 17
We have run our new quantitative Slide Rule over the Support Services sector. Of the c.500 stocks we have ranked on a Quality, Value, Growth and Momentum basis in the small to mid-cap space, 21 Support Services stocks appear in the top 100. Fulcrum leads the pack, ranked no. 6 out of 500 (and not coincidentally our top pick for the year), closely followed by Brainjuicer (no.7), Sanne (no.8), Learning Technologies (no. 12) and Next Fifteen (no.16). These stocks have high ROCE on both an EBIT and cash basis, strong growth prospects, earnings and share price momentum and valuations that, in this context, remain attractive. At the other end of the spectrum, HSS, Management Consulting, Serco, Mitie and Lakehouse appear towards the bottom of the rankings. Strong returns could, of course, be made if any of these turn their fortunes around, and management has been changed at Lakehouse, Serco and Mitie.
21 Mar 17
NAHL has a track record of being highly innovative around changes in regulation and we believe the changing personal injury landscape presents an opportunity to build market share. The recent strategy statement provides forecast benchmarks to base long term investment decisions. Whilst the shares are up 21% over the last month, valuations remain very modest with a FY17 PE of just 6.5x and a dividend yield of 10.4%. We believe the shares are meaningfully oversold and expect a recovery bounce to over 200p short term.
6% dividend yield for a growth stock?
16 Mar 17
4imprint’s proven operating model continues to steadily gain market share from a low base. Capital requirements are low, acquisitions unlikely, pension risk significantly reduced and, hence, future cash flow is likely to be returned to shareholders. We expect the current $22m net cash balance to be retained, providing a cushion against any macro downturns, and dividend growth to continue to match EPS, supplemented by special dividends when net cash builds (possibly every other year). As such, the free cash flow yield, 5.1% in FY2018E 5.8% in FY 2019E, is a proxy for the dividend yield, highly attractive in our view for a proven growth stock.
M&A coming to a company near you?
16 Mar 17
Markets have retained their relative strength over the last fortnight. We have seen a mixed reaction to the Budget last week, the passing of the Brexit Bill earlier in the week and the first interest rate hike by the Federal Reserve in the US yesterday. Against this backdrop, we have seen some notable M&A activity across a range of sectors which may move down the market capitalisation scale. We now face an extended period of heightened speculation but “no running commentary” regarding Brexit in the UK after Article 50 is triggered at the end of the month.