The growth prospects of sports agent TLA Worldwide (TLA:AIM) are not fully reflected in its valuation and upcoming interims could drive a re-rating of the stock. House broker Numis is forecasting 2015 earnings per share of 3.8p. This represents a 22.6% increase on the 2014 estimate of 3.1p and, at the current share price of 38.7p, implies an attractive forward price to earnings growth ratio of 0.4.

The £47 million cap’s core business involves acting as an agent for baseball players. This provides good visibility given the strong dynamics behind Major League Baseball in the US and the long-term guaranteed income from commission on player’s contracts. Chief executive officer Michael Principe says although baseball representation will continue to be its bread and butter he does not expect it to remain at its current level of around 70% of group revenues.

TLA WORLDWIDE - Comparison Line Chart (Rebased to first)

Accordingly the company is branching out into other sports, managing events such as a game between the New Zealand rugby union team – popularly known as the All-Blacks – and their US counterparts at Soldier Field in Chicago and bringing the International Champions Cup pre-season football tournament to the Asia Pacific region next year. Numis estimates the latter could benefit 2015 revenue to the tune of $4 million. Net debt was up from $3.9 million to $6 million in 2013 on an increase in working capital but a reduction is expected by the year end.

Numis’ 52p price target implies 35% upside.

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Issue Date: 22 Aug 2014