Deutsche Bank has downgraded shares in Intercontinental Hotels Group PLC (LSE:IHG) to 'hold' from 'buy', though the target price has been tweaked upwards to 5,850p from 5,730p.
The German investment bank believes all the 'upside' is now priced into the shares.
IGH recently published its full-year results, posting underlying earnings (EBIT) of $828 million, which was slightly below the consensus.
The lower figure was due to forex headwinds of $17 million and $5 million of Iberostar agreement costs. However, the company's free cash flow was strong at $565 million, compared to $571 million in the previous year.
In addition to these results, the hotelier announced a final dividend of 94.5 cents, which represents a 10% year-on-year increase. The full-year divi was 138.4 cents, a 61% increase.
The company also revealed that it plans to buy back $750 million worth of shares over 2023 following the completion of the earlier $500 million announced in the previous year.
Deutsche noted that all of these developments mean that IGH is set to return around $1.7 billion to shareholders in buybacks and dividends since 2022. This is roughly 15% of the market cap in January 2020.