LONDON, Aug 6 (Reuters Breakingviews) - London Stock Exchange Group’s (LSEG.L) takeover of Refinitiv is evident everywhere except its share price. Swallowing the financial-information purveyor has transformed the 43 billion pound company: roughly two-thirds of its revenue now comes from flogging data and analytical tools. Yet its stock still trades more like the European exchange operator it used to be than the global information group it has become. When Chief Executive David Schwimmer unveiled the mega-merger two years ago, LSEG shareholders gave it a rapturous welcome. Recently, however, they have become more nervous about the former Goldman Sachs (GS.N) banker’s ability to turn around Refinitiv, previously owned by Thomson Reuters (TRI.TO), the parent company of Breakingviews. An unexpected increase in costs and recent outages to Refinitiv’s flagship financial-information product, Eikon, have fuelled the concerns. Even after a 4% bounce on Friday morning, LSEG shares are down 14% this year, while the benchmark FTSE 100 Index is up 10%. The new-look group has some obvious weak spots. The division which houses Eikon has shrunk for several years: its revenue contracted by a further 0.1% year-on-year in the first half of 2021. Yet units which sell fraud-prevention services and provide data feeds to banks and investors are expanding. Overall, the Data & Analytics division’s first-half revenue was up 4.8% year-on-year on a pro-forma basis. That’s in line with Schwimmer’s expectations for growth of 4% to 6% a year, in line with the broader market. Schwimmer’s broader financial goals are still in doubt, though. Average forecasts compiled by Refinitiv project that LSEG will generate revenue of around 7.7 billion pounds by 2023. That represents a compound growth rate slightly lower than the minimum 5% a year promised by the company. Analysts also expect LSEG’s EBITDA margin to be below the company’s 50% target by 2023. Investors are therefore reserving judgment. After including net debt of 7.1 billion pounds at the end of June, LSEG’s enterprise value is around 50 billion pounds. That’s about 13 times forecast EBITDA for 2023, which is in line with smaller Frankfurt-based rival Deutsche Boerse (DB1Gn.DE), but lower than U.S. exchange operators like Intercontinental Exchange (ICE.N) and CME (CME.O). Meanwhile, rival data providers like FactSet (FDS.N) and S&P Global (SPGI.N), which is absorbing IHS Markit (INFO.N), are valued at around 20 times EBITDA. Schwimmer faces a long haul. Follow @peter_tl on Twitter CONTEXT NEWS - London Stock Exchange Group on Aug. 6 reported a year-on-year rise of 4.6% in revenue in the first half of 2021, though warned about a pick-up in costs in the second part of the year. - LSEG said total revenue hit 3.36 billion pounds ($4.67 billion), on a pro-forma basis to reflect its takeover of Refinitiv, which completed at the end of January. Adjusted operating profit rose 4% to 1.3 billion pounds. - However, it warned that it expected further cost increases in the second half of 2021, caused by the return of costs such as travel as well as ongoing expenses from legacy IT and inflation. - It said it would pay an interim dividend of 25 pence for each share, a rise of 7% from a year ago. - LSEG Chief Executive David Schwimmer said on July 2 the company was confident that its data and analytics division, which houses most of the Refinitiv businesses, could deliver revenue growth of 4% to 6% a year over the medium term. - Thomson Reuters, the parent company of Breakingviews, is the former owner of Refinitiv and has a minority stake in LSEG. - LSEG shares were up 3.6% at 77.38 pounds by 0730 GMT on Aug. 6.