Citi said on Friday that the overall risk/reward on education publisher Pearson “tilts positively”.
The bank, which rates the shares at ‘buy’, said there is a risk in the run-up to the third quarter that Pearson investors “miss the wood for the trees”.
Citi noted that for the first time in more than a decade, there is a prospect of enrolment growth in US higher education. It also said that Pearson+ will likely be additive to growth over time and could be a catalyst for a re-rating.
Finally, the bank said the recent selloff in the shares has created an “interesting valuation opportunity”.
At 1035 BST, the shares were up 2.8% at 731.60p.
