LONDON (ShareCast) - (Sharecast News) - Analysts at Canaccord Genuity lowered their target price on British gambling company Rank on Thursday, citing weakened activity on the high street and poor weather conditions across the UK.
After reporting a "limp" first quarter, Canaccord dropped its price target on the FTSE 250 constituent to 150p from its previous 175p mark, noting that it expects a "very weak profit performance" moving into 2019.

"We expect that poor weather and ongoing high street malaise will continue to drive declines through Rank's H1," said the Canadian broker.

Canaccord anticipates "some moderation" in the rate of decline in Rank's revenues in the second quarter of its trading year, but said, given high operational gearing in the land-based businesses, it expects Grosvenor Casino's profits to be down as much as 30%, with group operating profits declining 29% to £29.8m.

"We expect the response from management to be a further round of cost cutting, focusing on the Grosvenor business, which has also seen a number of management changes."

The broker also sees a drive for central overhead/procurement savings in Rank's immediate future.

"This should under-pin a recovery in profits in H2, but insufficient to achieve our previous forecasts."

Canaccord reiterated its 'hold' rating on Rank.

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