Listings and review brand Time Out (TMO:AIM) falls 2.5% to 136p as it unveils plans to launch a food market in Miami’s South Beach.

This will be the fourth of its food hubs after a 70,000 square foot venue in Lisbon (pictured below) and the planned markets announced in London and Porto in October. These spaces are intended to offer an opportunity for food shops and restauranteurs to showcase produce and culinary skills, with Time Out taking a share of any revenue.

Time Out Market Lisbon 3

PREMIER SHOPPING DESTINATION

This new location in Florida’s second largest city is a premier shopping destination and is expected to cover 17,200 square feet.

Miami was one of the cities identified by chief executive Julio Bruno when discussing a roll-out of the concept back in June, others on the list include New York and Berlin. Although we can see there is some value in the brand, we discuss our reservations over the investment case here. Notably the stock remains firmly below its 150p issue price.

TMOCHART

BULL CASE

Unsurprisingly house broker Liberum is much more positive with a ‘buy’ recommendation and 195p price target.

Analyst Andrew Bryant comments: ‘The investor upside is that the IPO investment and Management strategy transforms TO into a digital business delivering high revenue growth by simply improving the monetisation of the existing audience (monthly audience reach increased to 137m users from 111m at the time of the IPO) and expanding the Markets concept globally (our model assumes Markets will be delivering £9m+ of EBITDA by 2020).’

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Issue Date: 15 Dec 2016