Broker snap: Encouraging trends at Whitbread

13th Oct 2009 13:10

Interim results from Whitbread have generally been well received by the market with the improving trend at the company's Premier Inn hotel business being the most positive aspect.Jonathan Jackson, head of Equities at Killik, is not inclined to change next year's earnings forecasts after the interim figures, however, which leaves the shares trading on 15.7 times projected earnings per share for the year to February 2011, making the shares no more than a 'hold' in the broker's view.'Going forward, the assumption is that the economic conditions will remain difficult for the foreseeable future. However, the market will be encouraged that, in the nine weeks since the pre-close statement (13 August 2009), the momentum seen in the second quarter has continued,' Jackson said.Panmure Gordon remains an advocate of buying the shares, however, and has lifted its target price from 1270p to 1470p, and bumped up its earnings forecasts by around 10% on the basis of higher margin assumptions.