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Whitbread is set to sell or convert a third of its Beefeater and Brewers Fayre pubs estate after a private equity swoop collapsed.
https://www.thetimes.co.uk/article/whitbread-takes-the-axe-to-beefeaters-and-brewers-fayre-pubs-xqcq33gdn
Jefferies has issued a 'buy' recommendation for Whitbread PLC (LSE:WTB) with a price target of £42, indicating a potential upside of 31% from its current price of £32.12.
This optimistic outlook is grounded on Whitbread's recent performance and prospects, especially considering the Smith Travel Research (STR) data for February, which showed mixed results for the mid-scale hotel market in company's key markets - the UK and Germany.
Despite a slight decline of -0.6% in UK revenue per available room (RevPAR) and a moderate growth to +4.3% in Germany, Jefferies believes these numbers align with the market's expectations and doesn't foresee a change in financial year 2024 estimates.
Whitbread, known for operating hotels primarily under its flagship brand, Premier Inn, is positioned as a beneficiary in the UK's pressured consumer environment, the American investment bank said.
The company's value proposition, coupled with the accelerated decline of independent competitors since 2019, positions Whitbread favourably in taking market share, Jefferies added.
This scenario is bolstered by the industry-leading yield management practices of Whitbread, creating a promising environment for the company.
Whitbread shares, down 12% in the year to date, were flat mid-afternoon Tuesday at 3,193p.
Shore Capital Markets has maintained a generally positive outlook on Premier Inn parent Whitbread PLC (LSE:WTB) despite recent underperformance and projections of a downturn in RevPAR (Revenue Per Available Room).
Analysts said Whitbread's financial forecasts suggest a trajectory of growth, with anticipated improvements in revenue, EBITDA, and adjusted profit before tax over the next few years.
“We maintain our BUY stance on Whitbread with the forthcoming preliminary results at the end of April set to provide greater clarity of the trading backdrop,” said Shore Cap.
European operations are also continuing to build.
Shore Cap said: “In Germany, we expect Whitbread to meet its milestone of reaching run-rate profitability in the current calendar year although it is arguably the return metrics on its maturing portfolio of hotels which is key".
Whitbread shares are currently down 12.3% year to date at 3,168p.
A current valuation ratio of 12 times net forward income suggests the market is now starting to price in a 5% fall in UK like-for-like RevPAR, said ShoreCap analysts.
“This continues to feel too low, given attractive returns (ROI of 15%), significant freehold backing and market leading position.”
Commercial real estate vulnerable due to ongoing fear of another banking crisis? Only thing I can think of. SFR has been hit hard too.
https://www.euronews.com/business/2024/02/08/is-a-commercial-real-estate-crisis-unfolding-across-europe
Gruyere,
Possibly, not unusual for this share to do this....
I think its being shorted and timed to coiincide with the end of the buyback so the selling pressure isn't balanced by he buys. Just a personal opinion.
There is no bad information. I wouldn't be too concerned. solid company. Plenty of cash.
This will move on up again.
Does anyone have any idea what might or might not be happening.has there been a leak of information we should know about ??
Another nasty drop in the last hour 🤔
Broker upgrade
Whitbread Plc: AlphaValue/Baader Europe upgrades to buy from add with a price target raised from GBX 4440 to GBX 4551.
I bought at -5.12%. Fill ya boots.
US PCI will bring this back up somewhat. Absolutely no reason for the drop. I would argue WTB is stronger after covid. Thousands of smaller hotels have closed post covid increasing WTB market share.
Suppose when you have the Directors selling large numbers of shares at a 15% gain in share price for the year one can see why brokers are marking down on sentiment. They are no doubt making use of the 30 day window before the results. So the Market is thinking this might be a reflection going forward I suppose. Does seem a big drop for today however considering but Sentiment can play a role, and it does seem strange selling before results and where the govt. has reined in CGT for the year?
If that's the only reason for the drop then fill your boots.
This will be nearer £40/share than £30 after Full Year results at the end of April.
As usual, analysts from UBS talking out of their nether regions. For my sins, I undertake financial analysis for commercial real estate companies - give me a Premier Inn any day of the week as a tenant. Strong underlying financials, and along with Travelodge, taking market share from the mid-market players, who in my view, are the one's that will be finding things 'tougher'.
Bought on the 5% dip here ...
Premier Inn owner Whitbread is the biggest FTSE faller, down 5.6%. A note from UBS on the hotels sector noting that the UK competitive position for Premier Inn is "slightly" tougher than pre-Covid, though it "continues to be well positioned".
Anything to do with this?
https://investing.thisismoney.co.uk/rns/news/34120877
The buy back finished on the 23rd January.
Just over 10% of rooms are in Germany. Bad German inflation numbers aren't behind this price fall.
Germany inflation figures dropping through the floor german economy going into deep recesion .
eu will cut interest rates soon to try to stimulate the economy but germany will be hit the hardest.
DYOR.
It seems odd to be doing a buy back if the numbers are off.
Still cant find a reason for the drop, but have bought a few
Then its either a leak of news or manipulation via shorting - whatever it is small PI's aren't in the loop. Personally I took a chance and added a few - but she's still going down.
A stock with this market cap doesn't fall like this without a reason.
I can't see a reason. The share buyback is close to ending but so what the business is fundamentally sound.