IWG plc: Strong Financial Performance and Strategic Initiatives Drive Buy Rating

Stifel Nicolaus analyst Sam Dindol has maintained their bullish stance on IWG stock, giving a Buy rating on February 28.

Sam Dindol’s rating is based on several positive indicators in IWG plc’s financial performance and strategic initiatives. The company’s FY24 results met expectations, with a notable adjusted EBITDA of $557 million, and a promising outlook for FY25 with an expected adjusted EBITDA range of $580 million to $620 million. Additionally, the announcement of a $50 million share buyback and an increased dividend reflects a strong commitment to returning value to shareholders.
Another factor contributing to the Buy rating is IWG’s strategic shift towards capital-light growth, which is evident in the significant increase in fee income from its Managed & Franchise business. The company has also shown robust performance in its traditional business, with a contribution profit increase of 11%. Despite global economic uncertainties, IWG’s financial leverage is expected to improve, with net debt/EBITDA projected to reach 1x by the end of FY25, further supporting the positive outlook for the stock.

In another report released on February 28, Barclays also maintained a Buy rating on the stock with a £2.60 price target.