IHG11 Feb 2012 12:37
Panmure Gordon reiterated its "buy" recommendation for InterContinental Hotels (IHG) with an increased target price of 1,555p, from 1,420p. The broker forecasts the hotel chain to report full year EBIT of 544 million dollars (344.9 million pounds), 22% higher than in 2010. Earnings forecasts put the company on a multiple of 17.8 times, which the broker admitted is not cheap, but added that its exposure to the US market could lead to forecast upgrades. However, Shore Capital rates the firm a "sell", noting that the shares have outperformed the FTSE All Share by 20% over the last three months. Additionally, Shore pointed out that the group has limited growth visibility and is highly vulnerable to changing economic conditions. InterContinental shares advanced by 18p to 1,397p.