FDM Group: Hold Rating Amid Declining Consultant Numbers and Market Uncertainty

Stifel Nicolaus analyst Peter McNally maintained a Hold rating on FDM Group (Holdings) (FDM – Research Report) today and set a price target of p250.00.

Peter McNally has given his Hold rating due to a combination of factors including FDM Group’s current trading conditions and market outlook. The company’s AGM update revealed a significant decline in consultant numbers, which aligns with the board’s expectations but also indicates a challenging environment. This decline is consistent with a projected revenue drop, which has not prompted any changes in revenue estimates for the fiscal year 2025.
Despite some signs of IT budget stabilization in late 2024 and early 2025, ongoing macroeconomic uncertainties have led to deferred investments in recruitment. FDM Group’s cautious approach to managing its fixed costs and discretionary spending appears prudent given the circumstances. The stock’s valuation, with a PE ratio of 14.5x for FY25E and a substantial cash reserve, suggests a balanced risk-reward profile, justifying the Hold rating while awaiting clearer signs of market improvement.