The London Stock Exchange Group share price has come under pressure in the past few months, mirroring the performance of other similar companies amid AI disruption jitters. It was trading at 7,706p on Tuesday, down sharply from last year’s high of 12,025.
London Stock Exchange Group in focus ahead of earnings
The LSEG share price has slumped in the past few months as the company continues facing major headwinds across most of its business.
For example, its exchange business is facing challenges as the Initial Public Offering (IPO) drought has accelerated this year, as no companies have gone public there in the past few months.
At the same time, some top companies have changed their listing from the UK to the United States. Some of the most notable companies are names like Flutter Entertainment and CRH. Other large companies like Beazley and Schroders have received takeover offers.
The company’s data business is also facing major challenges as investors remain concerned that new and upcoming AI tools will disrupt its business.
This is important because, while the London Stock Exchange is known for its listings and trading, its most profitable business is its data and analytics business. Its data and analytics business grew after the company acquired Refinitiv, the data platform from Reuters.
The most recent results showed that its data and analytics business grew by 2.9% in the third quarter to over £982 million, while its FTSE Russell and Risk Intelligence rose by 7.1% and 9.9% to over £241 million and £144 million, respectively. This growth brought its revenue to £2.2 billion, up by 4.8% from the same period a year earlier.
The company also announced that a group of banks acquired a 20% stake in its Post Trade Solutions business. This acquisition helped the company to announce more share buybacks, increasing its purchases to £1 billion by February.
The upcoming results come a few weeks after Elliot Management acquired a big stake in the company. According to Reuters, the hedge fund is calling on the company to launch a £5 billion share buyback program.
Also, analysts believe that the company can sell its 51% stake in TradeWeb to generate cash for these buybacks. TradeWeb has a market capitalization of over $25 billion.
City analysts are still optimistic that the company’s growth will continue in the foreseeable future.
The consensus estimate is that its annual revenue for 2025 was £9.3 billion, which will then grow to £9.8 billion and £10.5 billion in the next two consecutive years.
Also, analysts believe that its underlying profit will jump to £2.17 billion in 2025 followed by £2.3 billion and £2.5 billion in the next two years.
LSEG share price technical analysis
LSEG stock chart | Source: TradingView
The weekly timeframe chart shows that the LSEG share price has slumped in the past few months, moving from a high of 12,025p in February last year to the current 7,706p.
It has slumped below the key support level at 8,125p, its lowest level in September last year. Also, the stock is about to form a death cross pattern as the spread between the 50-week and 200-week Exponential Moving Averages (EMA) narrow.
Therefore, the most likely scenario is where the stock remains under pressure in the near term. If this happens, the stock may continue falling, potentially to the psychological level at 7,000p.
However, in the long term, the stock will likely bounce back as investors buy the dip and the fears of AI disruption fade.
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