16th July 2014
The London Stock Exchange (LSE) remains a hold says Graham Spooner, investment research analyst at The Share Centre following this week’s first quarter results which saw a 16% growth in income.
In a note published this morning, Spooner notes that the LSE has faced currency issues from a strengthening pound. However he adds: “A buoyant IPO market has boosted figures and growth was seen across the group. As the IPO pipeline remains strong there is the potential for continued growth in this area, however investors should be aware that the weak performance of recent listings could delay the arrival of some of these companies to market.
“Diversification has been the key for LSE, with the latest focus being on the acquisition of Frank Russell and an increased holding in clearing house LCH Clearnet.
“We recommend LSE as a ‘hold’ for investors as entrance into the FTSE 100 and strong performance have pushed the share price higher in recent months and we believe it is currently fairly valued.
“The rights issue likely to happen in September is also a reason investors may wish to sit tight for the time being. However, we believe the stock is likely to mirror the markets, so it may be one to consider for bullish investors. Although as the group continues to diversify we could see it perform despite market conditions.”