Intrinsic Value GL Events S.A. (GLO.PA)

• Previous Close: €32.20
• Intrinsic Value: €222.67
• Upside potential: +592%

Stock Valuation Context

Business Model And Market Position

GL Events SA operates as a leading player in the global events industry, specializing in integrated event solutions across three core divisions: Live, Exhibitions, and Venues. The company's diversified portfolio includes corporate, institutional, and sports events under GL Events Live, while its Exhibitions division manages trade shows and consumer fairs across sectors like food, culture, and construction. GL Events Venues oversees a network of 50 multi-purpose facilities, positioning the firm as a one-stop provider for event planning, logistics, and venue management. The company’s hybrid model—combining asset-light consulting services with owned venues—enhances resilience against cyclical downturns. Its strong foothold in Europe, particularly France, and expanding international presence in high-growth markets underscore its competitive edge. By leveraging long-term venue contracts and recurring exhibition revenue, GL Events mitigates the inherent volatility of the events sector while capitalizing on the global recovery in in-person gatherings post-pandemic.

Revenue Profitability And Efficiency

GL Events reported FY revenue of €1.63 billion, with net income of €73.4 million, reflecting a margin of approximately 4.5%. Operating cash flow stood at €199.5 million, though capital expenditures of €130.4 million indicate ongoing investments in venue upgrades and expansions. The company’s ability to convert revenue into cash underscores operational efficiency despite sector-specific cyclicality.

Earnings Power And Capital Efficiency

Diluted EPS of €1.9 demonstrates moderate earnings power, supported by the asset-light Live division and high-margin venue management. However, the elevated debt load (€1.57 billion) suggests capital efficiency could improve, with interest coverage likely pressured by rising rates. The firm’s hybrid model balances lower-margin exhibition revenue with steadier venue cash flows.

Balance Sheet And Financial Health

The balance sheet shows €533 million in cash against €1.57 billion in total debt, indicating a leveraged but liquid position. Debt levels are manageable given stable venue cash flows, though the 1.44 beta reflects market sensitivity to economic cycles. Capex commitments may constrain near-term deleveraging.

Growth Trends And Dividend Policy

Post-pandemic recovery in live events drives growth, with venue utilization and exhibition volumes normalizing. A €0.7/share dividend implies a payout ratio near 37%, balancing shareholder returns with reinvestment needs. International expansion and cross-divisional synergies offer organic growth levers.

Valuation And Market Expectations

At a €706 million market cap, the stock trades at ~9.6x net income, aligning with peers. The beta above 1 suggests investors price in cyclical risks, but long-term venue contracts and diversified revenue streams justify a premium to pure-play event operators.

Strategic Advantages And Outlook

GL Events’ integrated model and venue ownership provide structural advantages, insulating it from pure-play competitors. Near-term headwinds include interest expense and economic uncertainty, but pent-up demand for in-person events supports a positive outlook. Strategic focus on high-margin services and international diversification should sustain growth.

Sources

Company filings, Euronext Paris disclosures