LONDON (ShareCast) - (Sharecast News) - Analysts at Canaccord Genuity lowered their target price on Premier Inn operator Whitbread to 4,250p from 4,500p on Friday following the group's "disappointing" third-quarter update in the previous session.
Whitbread, which Canaccord kept at 'hold', now expects to end 2020 in line with expectations after enjoying a "marginally better quarter", with group total sales growth of 1.0% in the third quarter.

Canaccord left its full-year 2020 forecasts unchanged following the update, but moved to downgrade its earnings per share forecasts by 8% to 201.1p for 2021 to reflect increased cost guidance from the grocer's management team.

The Canadian broker said Whitbread's "get-out-of-jail card" was a recovery in UK regional business travel driven by recovering business confidence which it feels "should" act to underpin to the group's share price.

Canaccord highlighted that Whitbread now has 80,000 UK rooms, with another 20,000 in the pipeline and "line of sight" to more than 110,000.

"We assume 3,000 gross new UK rooms in FY20E with the majority (once again) opening in Q4," said Canaccord.

Over in Germany, Whitbread now has three hotels open, with a further 20 hotels due to open by end 2020 as the result of the Foremost Hospitality acquisition and the second acquisition of a package of three hotels, however, Canaccord noted that the firm had guided to an operating loss of £12m for Germany in 2020.

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