With one of the world’s largest research networks YouGov (LON:YOU) will certainly have gained more credence and business, especially as the world seems to be going in and out of Elections.
However, the recently issued Current Trading Update noted that following its H1 results it has been seeing lower sales bookings than had been previously anticipated.
The Business
YouGov is an international online research data and analytics technology group.
With operations in the UK, the Americas, Europe, the Middle East, India and Asia Pacific, it is certainly one of the world’s largest research networks.
The £532m capitalised group considers that its mission is to offer unparalleled insight into what the world thinks.
YouGov’s innovative solutions help the world’s most recognised brands, media owners and agencies to plan, activate and track their marketing activities better.
Shares Collapse
The day before the Update was released, on 20th June, the group’s shares were trading at around the 820p level.
The unexpected news saw them being almost halved in price in reaction, falling 380p to close that day at 440p.
Within a week they had eased even further to 402.63p.
Insider Dealings
Since the Update it has to be noted that a number of the group’s Directors have been buyers of the shares.
They have a very short period of ability to deal in the stock because the company will be announcing its Year End Trading Update on Thursday 1st August.
Market View
A couple of weeks ago analyst Jessica Pok at Peel Hunt chopped her Price Objective for the group’s shares, from her previous aim of 1,500p a share to just 630p.
At that time, she noted that she disagreed with the market view that the business is broken.
The shares have fallen since its full-year profit warning led Pok to reduce her full-year 2024 and 2025 earnings per share targets by 44% and 39%, respectively, with conservative growth assumptions built in for next year.
“The shares (then 420p) are currently trading at 11 times full-year 2025 price to earnings, which is near YouGov’s lowest rating in over a decade.
The market is pointing to a broken business, which we do not believe is the case.
However, we expect the shares to trade sideways until investors have more confidence in the future strategy and gain further insight into management’s plan of action at the prelims.”
On the professional investor front Julian Fosh and Anthony Cross, Managers of the Liontrust GF Special Situations Fund, which is valued at some £80m, consider that it will take time to rebuild investor confidence in the company after its profit warning, but they remain invested.
My View
It will be more than interesting to see just how the group’s shares perform in the next couple of weeks up to the Year End Trading Update being announced on Thursday 1st August.
The very point that ‘insiders’ took advantage of the collapsed share price is perhaps predictive, so one might hope that there is good news in the offing.
The shares have already started to show some signs of price recovery, currently trading at around the 460p level.
The group describes itself as the #1 most-quoted market research source worldwide, being trusted to provide unparalleled into what the world thinks.
I wonder what the world thinks about YouGov’s shares right now?