from Citywire this morning10 Jun 2021 08:21
Long-term opportunity at SSP, says Shore Capital
SSP (SSPG) may have to wait until 2024 for sales to return to pre-pandemic levels but Shore Capital says in the long term the food-on-the-go sector will boom.
Analyst Greg Johnson reiterated his ‘buy’ recommendation on the stock after the owner of Upper Crust and Ritazza reported a dramatic rise in losses to £300m in the six months to 31 March, from £34m a year earlier. The shares closed down 1.9%, or 5.8p, at 302p on Wednesday.
‘Based on a recovery of pre-Covid-19 passenger volumes and a return to historic growth trends, the global travel foodservice market could be worth some £30-35bn by the end of the decade,’ said Johnson.
‘Were the group to increase its market share towards 20% it could equate to annual revenues of £6bn, sharply above our long-term modelling assumptions but not necessarily out of kilter with its historic track record.’