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Research Alert: CFRA Maintains Hold Opinion On Adss Of Pearson Plc
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Research Alert: CFRA Maintains Hold Opinion On Adss Of Pearson Plc
Aug 6, 2025 11:02 AM

01:35 PM EDT, 08/06/2025 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We adjust our 12-month target price for Pearson to USD16 from USD17, based on a 2025 P/E of 18.5x, above its five-year average forward P/E of 17.4x, justified by its medium-term earnings resilience, in our view. We leave our EPS forecasts unchanged. Pearson reaffirmed its 2025 guidance, with management anticipating a stronger second half, particularly in Q4. We interpret the reaffirmation as a sign of confidence in the business's trajectory despite ongoing FX volatility. Management continues to target a mid-single-digit sales growth CAGR and sustained margin expansion over the medium term, which we believe reflects a credible roadmap anchored by its evolving digital platform. However, the English language learning segment saw a 3% decline in H1 2025, with the Pearson Test of English expected to decline in the second half of the year. Pearson's valuation also offers limited upside potential, in our view, as its shares trade above the five-year average P/E. Hence, we maintain our Hold rating on Pearson.

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