RELX Reports Solid H1: Dividend Raise, and Reaffirmed Outlook Has Shares Holding Steady

RELX shares (LON:REL) are are holding steady today, as the release of its first-half 2025 results showcased robust growth across key metrics, with the firm reaffirming the FY outlook, and boosting the dividend.

RELX reported revenue of £4,741 million for the first half of 2025, a 7% underlying increase compared to £4,641 million in the same period last year. Adjusted operating profit rose by 9% to £1,652 million, up from £1,583 million. Adjusted earnings per share (EPS) also saw significant growth, increasing by 10% on a constant currency basis to 63.5p, compared to 59.5p.

The company also announced a 7% increase in the interim dividend, raising it to 19.5p from 18.2p. Furthermore, RELX has maintained a strong balance sheet, with a net debt/EBITDA ratio of 2.2x and an adjusted cash flow conversion rate of 100%.

The company completed three acquisitions for a total consideration of £262 million, further expanding its portfolio. It has also completed £1,000 million of its previously announced £1,500 million share buyback program.

CEO Erik Engstrom highlighted the broad-based strength across all business segments: “RELX delivered strong revenue and profit growth in the first half of 2025, in line with full year 2024 but with a higher quality growth profile.”

He specifically noted the strong growth in Risk, continued good growth and developing momentum in Scientific, Technical & Medical, a further step up in growth in Legal, and the establishment of strong ongoing growth in Exhibitions.

Engstrom also emphasized the company's strategic shift towards higher-growth analytics and AI-driven decision tools as a key driver of its long-term growth trajectory. “Our improving long-term growth trajectory continues to be driven across the group by the ongoing shift in business mix towards higher growth analytics and decision tools that deliver enhanced value to our customers,” 

The company reaffirmed its full-year outlook for 2025, expecting continued strong underlying growth in revenue, adjusted operating profit, and adjusted earnings per share on a constant currency basis.

The Bull Case

• Strong and consistent financial performance, with robust growth in revenue, operating profit, and EPS.
• Strategic focus on high-growth analytics and decision tools, leveraging AI and other technologies.
• Positive momentum across all business segments.
• Solid balance sheet with high cash flow conversion.
• Commitment to returning capital to shareholders through dividends and share buybacks.

The Bear Case

• Relatively high P/E ratio of 37.7x compared to the sector average of 25.1x, suggesting the stock may be overvalued.
• PEG ratio of 3.71, indicating that the stock's price may be high relative to its earnings growth rate.
• Potential for increased competition in the analytics and decision tools market.
• Exposure to macroeconomic factors that could impact customer spending.
• Risk associated with integrating acquired businesses.