[GOAL] Bullish Report on Elsevier, Pooh-Poohing Boycott Threats

[Stevan Harnad]

Bullish report on Elsevier, despite boycott threats.

Now, enough of the hoopla, please, and let's get back to the only thing that really matters, concretely, for OA today: 

Institutions and funders mandating green OA self-archiving!

Stevan Harnad

Begin forwarded message:

> Forwarded with permission
> To: <liblicense-l at listserv.crl.edu>:
> Date: Mon, 6 Feb 2012 19:47:24 -0500
> 
> Sami Kassab sami.kassab at exane.com
> 
> Bonjour,  Please find our report on Reed Elsevier released this
> morning. We argue that:
> 
> * Noise around boycott against Elsevier offers short term trading opportunity
> 
> Reed Elsevier was the worst performing media stock last week. We
> believe this is due to investor concerns on the back of T. Gowers'
> petition to boycott publishing and refereeing in Elsevier's journals.
> We believe the share price reaction was overdone and recommend buying
> the shares.
> 
> * Scientists are boycotting the boycott
> 
> Similar petitions in favour of Open Access were organised in 2000 and
> 2007, with no impact on Elsevier's fundamentals. Our tracking not only
> shows that this latest petition lags behind the two preceding ones but
> also suggests that its momentum is slowing. Fewer than 5,000
> scientists have signed up, whereas Elsevier works with more than 6m
> scientists worldwide. The low take-up of this petition is a sign of
> the scientific community's improving perception of Elsevier.
> 
> * Open Access unlikely to hurt financials in the medium term and is priced in
> 
> The proportion of Open Access is growing at less than 1% pa.
> Elsevier's contract lengths are getting longer and the company's
> growth efforts are focused on new products rather than pricing. Open
> Access is unlikely to hurt Elsevier in the next five years and the
> longer term risk is more than priced in, in our view
> 
> * Results are due on 16 February
> 
> We expect EPS11e of 47p, slightly ahead of the consensus 46p, and an
> outlook supportive of the group's defensive growth profile and
> improved fundamentals. The announcement of a new CFO and a possible
> share buyback could be two additional positives. Reed Elsevier PLC
> trades on EV/EBIT12e of 8.8x. It offers defensive growth at a
> reasonable price. We remain buyers of the stock on the current share
> price weakness.
> 
> Many thanks for your interest in our research!
> 
> Regards,
> Sami Kassab/Exane Paribus