Whitbread PLC (LSE:WTB) has several options to unlock shareholder value, analysts at UBS believe, after the hotel group's recent update.
The Swiss bank reiterated a 'buy' rating on the Premier Inn owner and raised its 12-month price target to 3,605p from 3,485p, citing stronger-than-expected trading and improved cost control in the third quarter.
Third quarter UK revenue per available room (revpar) rose 2.5%, ahead of the 2% forecast, with performance again ahead of the midscale and economy segment.
UBS noted a further acceleration in early fourth quarter trading, with revpar up 4% in the first six weeks to 8 January.
Analysts highlighted an additional £10 million in cost efficiencies and reduced guidance for 2027 inflation and business rates, with Whitbread having lowered its expected business rate headwind to £35 million from a prior range of £40-50 million.
UBS said several strategic options could unlock shareholder value, including selective UK asset disposals and a pivot in capital allocation between UK and German markets.
While some options, such as a full German sale, were viewed as unlikely, the analysts said the group retains flexibility.
Full-year results and a five-year plan update are set to be released at the end of April.