logo-loader
viewIntercontinental Hotels

Intercontinental Hotels upgraded to ‘buy’ as Deutsche Bank predicts fast recovery for hotels once pandemic ‘stabilises’

The bank said hotel stocks are “traditionally hit hard” in similar situations, but would rise quickly when revenue per available room “shows the first signs of recovery”

Intercontinental Hotels - Intercontinental Hotels upgraded to ‘buy’ as Deutsche Bank predicts fast recovery for hotels once pandemic ‘stabilises’

Intercontinental Hotels Group PLC (LON:IHG) has been upgraded to ‘buy’ from ‘hold’ by analysts at Deutsche Bank (DB), who said they expected the hotel sector to “recover as soon as the [coronavirus] situation stabilises”.

In a note on Thursday, which also saw the bank cut its target price for the Holiday Inn owner to 4,600p from 4,860p, the bank said hotel stocks are “traditionally hit hard” in situations such as the current pandemic, but would rise quickly when revenue per available room (RevPAR) “shows the first signs of recovery”.

READ: Intercontinental Hotels upped to ‘outperform’ as RBC highlights ‘low-risk business model’ amid pandemic

“A couple of months ago, China was almost the only country impacted by [coronavirus]. Since then, however, the disease has spread very rapidly to a large majority of the rest of the world… The correction [in stock markets] has been as dramatic as the advance of the virus around the world”, the bank said.

Deutsche Bank’s assessment follows a positive appraisal for IHG from RBC on Wednesday, with the Canadian bank saying the group had a “low-risk business model” and upgraded the stock to ‘outperform’ from ‘sector perform’.

Meanwhile, analysts also cut their price target for Whitbread PLC (LON:WTB), owner of the Premier Inn hotel chain, and retained their ‘hold’ rating on the stock.

Shares in IHG were 2.6% lower at 3,070p in late-morning trading, while Whitbread inched up 0.5% to 2,742p.

Quick facts: Intercontinental Hotels

Price: 4094 GBX

LSE:IHG
Market: LSE
Market Cap: £7.48 billion
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

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...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Iofina PLC reveals 'record breaking year' in 2019 trading update

Iofina PLC (LON:IOF) CEO Tom Becker tells Proactive it has moved into a profit in 2019 after record iodine production for a second year running. Becker says the chemicals group reported revenues that rose by 22% to more than $29 million, while there was a pre-tax profit of $600,000 compared...

4 minutes ago

2 min read