Analysts at Berenberg raised their target price on hotel operator Dalata Hotel Group from 400.0p to 440.0p on Monday, stating it was sticking by “a long-term compounder”.
Berenebrg stated that following the reopening of hotels in Ireland on 2 June, it had updated its forecasts on the group’s recovery.
“While we now assume a slightly more cautious outlook, we continue to believe that international travel will ultimately recover, and believe that, with its excellent balance sheet, Dalata remains well placed to grow its pipeline in the meantime,” said the analysts.
“The most significant changes to our forecasts are for the current year, due to the later-than-expected reopening of hotels in the UK and Ireland, as well as the continuation of travel restrictions. However, we still expect a full recovery to ultimately be achieved, and forecast that revenue per available room (RevPAR) will be above 2019 levels in regional Ireland in 2023, and in Dublin and the UK in 2024.”
With Dalata shares trading “slightly below” net book value, the German bank also opted to reiterate its ‘buy’ rating on the stock.
Analysts at Liberum raised their target price on direct marketing business 4imprint Group from 3,000.0p to 3,300.0p on Monday, stating recent strong momentum for the company looked set to continue.
Liberum said there has been “good momentum” at 4imprint, with July 2021 orders at 112% of those seen in July 2019 amid what appears to be “an element of pent-up demand”.
The analysts also increased their full-year 2021 earnings per share estimates by 6% on the back of 4imprint’s recent results, despite maintaining “a cautious view” on margin progress and higher tax.
“There are still a number of uncertainties, but we believe recovered EPS in the range of 134c (97p) to 211c (152p) is achievable in FY 23. The middle of the range of 173c would represent 32% upside to our current estimate,” said Liberum, which also reiterated their ‘buy’ rating on the stock.
“We expect a much stronger recovery from Covid than the GFC. At the results, we reduced our FY 21 net cash (excluding leases) estimate of $55m to $50m due to the interim dividend, but we expect management to continue to maintain a cash buffer.”
