Berenberg lowers target price on SSP

4th Aug 2026 08:00

(Sharecast News) - Analysts at Berenberg nudged their price target on food and beverage outlets operator SSP down to 230p from 245p, but kept their 'buy' rating on the stock, saying the firm's core value was becoming clearer as operational delivery improves and strategic actions begin to take hold.

Berenberg said SSP had delivered peer‑leading like‑for‑like growth this year, helped by the strength of its M&S estate, commercial initiatives, its fully food‑and‑beverage‑focused model and a predominantly domestic footprint. It expects these drivers to support a solid fourth quarter performance, with reiterated free‑cash‑flow guidance keeping the door open for further shareholder returns.

The German bank highlighted a Q3 beat, with 4% like-for-like growth accelerating through the quarter on sustained UK momentum and better trading in Europe. Middle East trends also stabilised, with Gulf markets improving from ‑41% LFL at the start of Q3 to ‑31% later in the period. SSP reiterated guidance for FY26 EPS and more than £100m of free cash flow, which Berenberg said underlined structurally stronger cash conversion and kept a potential FY27 buyback in play.

Berenberg also said SSP's plan to exit loss‑making motorway and rail units in Continental Europe by FY28 should lift regional margins above 5%, simplify the investment case and drive around £16m of incremental underlying earnings. It also pointed to the value in SSP's India business, Travel Food Services, now valued at £667m, arguing that SSP's ex‑India valuation was not currently reflected in the share price.

Berenberg added that SSP can still deliver mid‑single‑digit organic growth and margin improvement even after deconsolidating India, supporting long‑term value creation.

Reporting by Iain Gilbert at Sharecast.com