Future (FUTR) £10.42

Market cap: £1.17 billion

Despite some recent economic jitters, we think the current valuation at media group Future (FUTR) undervalues the company’s strengths as it gets stuck into its GAS (growth acceleration strategy).

Based on consensus forecasts for 2025 the company trades on a price to earnings ratio of just 7.7 times. The current strategy hopes to deliver mid-single digit revenue CAGR (compound annualised growth rate) over the next three years and the media group has a new hire to help it achieve this.

Future’s new chief financial officer, Sharjeel Suleman will start on 16 September replacing Penny Ladkin-Brand who stepped down on 28 July after nine years with the company.

Ladkin-Brand’s tenure, which included the top finance job as well as a strategy role, coincided with a big increase in earnings and the share price – culminating in a valuation more than three times the current level during the pandemic.

The approach, pursued in concert with former chief executive Zillah Byng-Thorne, was to focus on brands, covering topics from films to computer games and photography, which were and are a conduit between fans and their enthusiasm or hobby. This helped drive a loyal and engaged audience which Future could monetise, employing a centralised platform to derive e-commerce, licensing and digital advertising revenue.

However, of late the shares have come under pressure thanks to a weak global outlook foradvertising spending.

Suleman, who joins from ITV (ITV), is certain to use her strong background in content and digital transformation in the role alongside CEO Jon Steinberg, who was appointed in April 2023.

The media group will continue with its ‘content-centric approach,’ the company, said and build on its reputation as a long-standing specialist.

Future has 300 titles including Ideal Home, games radar, TechRadar, and the price comparison site Go.Compare which made up 25% of the company’s first-half revenue.

These titles gave Future an impressive online reach of 481 million digital users in 2023. The group has guided toward aggregate investment associated with GAS of £25-30 million during the full year 2024 and full year 2025. Part of the strategy will involve focusing investment on its so-called ‘Hero’ brands – 12 titles which generate 50% of its revenue. The company is also targeting growth in US digital advertising. Digital revenue from across the pond is only twice the size of that from the UK, despite the addressable market being seven times larger.

A risk for the business if it pushes the commercial aspect too strongly is it alienates readers and followers so it does need to strike a balance here.

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