Source: Sharecast
Berenberg now forecasts negative revenue per available room growth in FY26 as a result of weak demand but noted that despite this, it was encouraged by the company's outperformance versus the wider market, the ongoing inflexion in Germany and its previously announced property valuation, which it thinks could be a "positive catalyst".
The German bank, which reiterated its 'buy' rating on the stock, noted that in its most recent set of results, Whitbread reiterated that its five-year plan remained on track to deliver incremental profit of at least £300.0m by FY30, while also generating more than £2.0bn in shareholder returns.
Berenberg also highlighted that since the plan was announced in October 2024, the UK market has continued to soften and cost inflation has risen as a result of changes to UK National Insurance costs. However, Whitbread has also expressed confidence in its cost-saving plans, which could help to offset this.
"That being said, both we and consensus forecast lower incremental profit. By FY30, we forecast an incremental £220.0m of PBT on what was delivered in FY25. However, this number is very sensitive to RevPAR and accommodation sales, with a 1% growth shift worth £16m-£17m of PBT in FY26. Therefore, if RevPAR growth outperforms our estimate, we would gain more confidence that its target for £300m of incremental profit by FY30 is achievable," said Berenberg.
Reporting by Iain Gilbert at Sharecast.com