Informa share price outlook ahead of earnings: Is it still a good buy?

Informa (LON: INF) share price has outperformed the FTSE 100 and FTSE 250 indices this year as its business performance improved. The stock has jumped by ~20% this year while the FTSE 100 index has risen by about 2%. 

Business is booming

Informa is one of the biggest companies in the events industry globally. The company is well-known for running business-to-business events around the world. As a result, Informa was one of the most affected companies when the Covid-19 pandemic happened. 

In the past two years, the company has seen strong growth after governments removed their Covid-19 restrictions. For example, its revenue rose from £608 million in 2021 to over £952 million in 2022. 

The next key catalyst for Informa share price will be the company’s financial results scheduled for Thursday. In June, as I wrote here, the company said that its underlying revenue would rise by 24.5% in the first five months of the year. 

This performance was broad-based, with Informa Markets recording 43.5% revenue growth. Informa Connect revenue rose by 19.2% while B2B Markets revenue rose by 31.2%. As a result, the management lifted its forward guidance for the year.

Informa also announced a £1 billion special dividend using the funds it generated after selling Informa Intelligence last year. It also resumed paying its dividends following the suspension at the height of the pandemic.

Informa boosted its forward guidance. It expects to have revenue guidance of between £2.95 billion to £3.05 billion this year and that its operating profit will be between £750 million and £790 million. Therefore, the upcoming results will not catch investors by surprise.

Informa share price forecast

INFchart by TradingView

The daily chart shows that the Informa stock price has been in an uptrend in the past few months. Along the way, the shares have formed an ascending channel that is shown in black. This price is a few points below the upper side of the channel.

The stock has moved above the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has moved below 60. Therefore, while the long-term trend for the stock is bullish, there is a possibility that it will retreat after this week’s results. This is known as buying the rumour and selling the news. If this happens, the stock will likely retest the support at 720p.