‘Rare’ opportunity to buy this FTSE 100 stalwart?

A “rare entry point” into RELX (LSE:REL) was today flagged in the City after the value of the top-performing FTSE 100 stock slid on the back of heightened peak artificial intelligence (AI) concerns.

The shares of the Elsevier journals and LexisNexis owner have fallen by more than 10% in August, fuelled by market jitters in the wake of lower full-year revenues guidance by US-listed business information services business Gartner.

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Relx shares were today at 3,509p, which is in line with their low point for the year during the  stock market sell-off shortly after Donald Trump’s tariffs announcement in April.

They topped 4,000p in May, having passed this threshold for the first time in February. 

Relx is one of the best-returning FTSE 100 stocks of the past four decades, ranking alongside British American Tobacco (LSE:BATS) and Rio Tinto Ordinary Shares (LSE:RIO) as the best of the 1984 FTSE 100 originals.

In a report published today, Bank of America said that the market’s perceived risks appear overdone as it concluded Relx is still the “AI winner” with an unchanged price target of 4,900p.

It noted that a period of similar AI concerns in 2023 preceded a 30% trough-to-peak recovery that year and “provided one of the best entry points into the story in years”.

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The bank said that it sees a repeat for a company that is one of its 25 stocks for 2025. It adds that Relx currently trades at a 30% discount to Thomson Reuters Corp (TSE:TRI), despite faster legal growth.

The biggest parts of Relx are its Risk and Business Analytics division and the Elsevier journals operation Science, Technical and Medical (STM). Legal is the group’s third-largest division, with the smallest being the Exhibitions arm.

Half-year results at the end of July showed underlying revenues growth of 7% to £4.7 billion, with adjusted operating profit up 9% to £1.65 billion. The interim dividend, which is due for payment on 11 September, increased by 7% to 19.5p a share.

Chief executive Erik Engstrom noted a higher-quality growth profile as Relx continues to combine leading content and data sets with powerful AI and other technologies. 

He said: “This has been a key driver of the evolution of our business for well over a decade, and will remain a key driver of customer value and growth in our business for many years to come.”

Bank of America said it sees AI monetisation gathering further pace into 2026, noting the significant exposure of Relx through the roll out of products to the bulk of the revenue base in Legal and the majority of products in STM’s databases and tools.

The bank adds that competitive threats from AI have been overstated given the company’s market leading position and services, which are well integrated into customer workflows.

Today’s Media & Internet sector note also disclosed an improved price target of 1,050p for the FTSE 100-listed academic publisher and trade shows business Informa (LSE:INF). The shares were today at 876.8p after a rise of 8% so far this year.

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The bank said: “A robust end to 2025 is on the cards, underpinned by typically good forward visibility and still upbeat industry sentiment based on our KPI tracking.”

An investor day is due to take place in November, where the bank expects an upbeat tone on mid-term growth potential and the margin outlook under the "One Informa" plan.

It also believes that a renewed focus on deleveraging will provide headroom for potential buybacks. The shares trade on an “appealing” 7% 2025 free cash flow yield, which the bank said suggests “we are at the start of a sustained rally”.