NLSN - Embedded Expectations Analysis - 2020 01 29
Nielsen Holdings plc (NLSN:USA) currently trades below recent averages relative to UAFRS-based (Uniform) Earnings, with a 19.9x Uniform P/E. At these levels, the market has bearish expectations for the firm, and management may be concerned about their leverage, technology investments, and gross productivitySpecifically, management may be concerned about the impact of the Global Media and Global Connect spin-offs on their respective balance sheets and leverage ratios. Moreover, they may be exaggerating the reach of Global Connect's footprint with grocers and data and analytics companies, the cross-functionality of their Connected system, and their ability to increase productivity through technology investments. Furthermore, management may lack confidence in their ability to delever, integrate acquisitions, improve margins and gross productivity, and sustain Audience Management segment growth. Finally, they may be downplaying concerns about loss of synergies arising from their spin-off and about Global Media's operating productivity and end-to-end accountability
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