Analyst Note| Niklas Kammer, CFA |
During its first of two investor days this year, London Stock Exchange Group, or LSEG, dived into its newly assembled data and analytics business. In focus were LSEG’s trading and banking, enterprise data solutions, and customer and third-party risk solutions segments. In October another investor day will cover investment solutions, wealth solutions, and its foreign-exchange trading venues. We had marked this event as a possible opportunity for management to shed light on its operating and capital expenditure outlook as well as potential synergy updates, which we believe are at the center of investors’ concerns. In this respect, our expectations fell flat as management promised to give a full update on these topics at the second-quarter results on Aug. 6. However, commentary by management during the call gives us confidence that risks to our fair value estimate sit on the upside. For now, we maintain our GBX 9,100 per-share fair value estimate and wide moat rating. Shares look undervalued.