Sign up UNITED KINGDOM
Proactive Investors - Run By Investors For Investors

Numis downgrades Thomas Cook following strong share performance

The broker reduced its rating following a 14% increase in the share price of the FTSE 250-tour operator over the last month
Thomas Cook shop
The broker currently holds a target price of 159p on the stock

City broker Numis has downgraded FTSE 250-travel provider Thomas Cook Group PLC (LON:TCG) to 'Add' from 'Buy' as recent strong performance in the shares left it within striking distance of the broker's target price.

Following the group’s interim results yesterday, in which it saw its pre-tax losses reduce by £20mln and bookings for its summer period already 59% filled, analysts at Numis said “TCG's material improvement in its NPS [net promoter score] over the last three years (+9 ppts) has yet to be fully reflected in customer demand, given the duration of the holiday booking cycle.”

READ: Thomas Cook’s pre-tax loss narrows as bookings grow ahead of busy season

The broker, which currently holds a target price of 159p on the stock, added: “We derive our FV from a blended SOTP, FCFE yield and EV/IC valuation … using a 35% discount to peers. This yields a FV of 159p and implies an FY19 P/E of 12.0x and FCFE yield of 7.0%. With 14% upside following the recent strong s/px performance, we issue an ADD recommendation.”

In the last month up to last close on 17 May, Thomas Cook’s shares have increased by 14% from 121.8p to 139.1p.

In mid-morning trading Friday, Thomas Cook shares were down 3% at 134.8p.

View full TCG profile View Profile

Thomas Cook Group Timeline

Related Articles

ZoomAway Travel Inc embracing blockchain, which is set to push out middle man in hospitality and act
January 11 2018
The firm plans to begin rolling out cryptocurrency payments into its white label and registration management system (RMS) clients
Amusement park
February 14 2018
Berenberg's analysts pointed out that accesso's end-to-end technology stack combined with its global footprint positions the group well in a market that is fragmented by product, geography and vertical
Oil pollution
July 02 2018
A name change might be in order if PCG pulls the trigger on two investments it is mulling

No investment advice

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

© Proactive Investors 2018

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use