Shares digital

YouGov (YOU:AIM) – Interims PTP: £3m (£2.3m) Divi: n/a (n/a)

The online market research company posted an impressive 208% rise in revenues to £18.8 million for the first half of the year. Organic growth was strong but the company also benefited from the first-time contributions of the Pyschonomics (USA), Zapera (Scandinavia) and Polimetrix (Germany) acquisitions made last year, which have added sector expertise and further geographical reach. Its client numbers have soared from 306 at the end of January 2007 to 1215 at the end of January 2008 with one of its most recent contract wins providing a great deal of optimism among analysts.

‘We have been particularly encouraged that YouGov has already secured a pan-European research assignment from the European Commission, demonstrating that the enlarged group can prove successful in challenging the industry giants for larger research projects,’ says Numis analyst Lorna Tilbian. So far, the company says second-half trading is in line with expectations, and plans to launch its BrandIndex service in Scandinavia should also provide a boost.

There have been concerns that marketing companies would suffer in times of economic uncertainty but YouGov looks to be more protected than most as its business is online. ‘Although a less rosy industry backdrop could prove demanding for many marketing communications groups, we believe that YouGov could benefit, as clients switch from traditional market research to online, which is not only faster and more accurate, but also provides a cost advantage,’ says Tilbian. She has set a 178p target price for the shares, some 21% above their current 147p

Shares says: The strong management team should ensure further growth and the company’s story is compelling.

by: Susanna Twidale