Berenberg downgrades Whitbread, upgrades IHG
By Michele Maatouk
Date: Tuesday 20 Jan 2026
(Sharecast News) - Berenberg downgraded Premier Inn owner Whitbread on Tuesday to 'hold' from 'buy', as it said the company has been the victim of exogenous factors outside of its control that have left the five-year plan out of reach.
The bank said its buy thesis on the stock was predicated on its expectation of strong unit growth and supportive market conditions in the UK; a growing opportunity in Germany, which is still taking shape; and a healthy balance sheet, with scope for shareholder returns.
"Our confidence in this has somewhat waned in recent months," it said.
Berenberg noted that unit growth has been sluggish and requires a meaningful step-up to hit the mid-term targets and, while UK RevPAR is back in growth, consensus forecasts of 1-2% RevPAR growth in FY27 appear to already factor this in.
"Germany progress has slower than we anticipated, and cost inflation across the business has persisted," it said. "While some relief may be on the cards from business rate increases, we forecast group profit before tax to decline year-on-year in both FY26 and FY27.
"While this should still leave scope for the dividend per share to be held and a buyback, the latter will be smaller in FY27 than FY26, in our view."
Berenberg said it awaits more clarity at the full-year results in April, when management will outline an update to the five-year plan. For now, it said the risk/reward was finely balanced and there is little upside to its unchanged price target of 2,900p.
In the same research note, Berenberg upgraded InterContinental Hotels to 'buy' from 'hold' and named it a top pick for 2026.
"We had sat on the sidelines on IHG as we expected uncertainties in the US to weigh on earnings; however, IHG demonstrated the resiliency of the model, with operating profit estimates growing versus the start of 2025 despite this," it said.
"As we look into 2026, we are more optimistic on the outlook. We expect US RevPAR growth to accelerate, we feel Greater China is reaching its floor and, with sustained growth in EMEAA, we expect an acceleration in RevPAR growth in FY26."
With net unit growth also expected to accelerate, fee margin expansion to continue and IHG continuing to buy back shares, Berenberg forecasts a 12% EPS CAGR over the coming years, which it said warrants its valuation.
Berenberg has a 9,200 price target on IHG.
The bank maintained its 'buy' rating on Accor as it expects the company to deliver market-leading RevPAR, while the potential Essendi sale could bring cash proceeds and additional shareholder returns.
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