Best of the Brokers for 3 November 2015
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BARRATT DEVELOPMENTS
Analysts at Jefferies have hiked their estimates for Zoopla’s full-year earnings by 15 per cent, citing growth in the number of agents on the property listing website and strong performance from uSwitch, a price comparison website Zoopla bought earlier this year. Zoopla may be the Britain’s number-two property portal behind Rightmove, but Jefferies analysts insist that the former has “more to gain” from returning customers and its uSwitch acquisition.
WHITBREAD
Analysts at Numis have downgraded Whitbread, saying the current profit-to-earnings ratio for the multinational hotel, coffee shop and restaurant company doesn’t reflect growing market risks for its largest division, Premier Inn. The Numis team notes that revenue growth for UK hotels is slowing, while competitor Travelodge is surging, not to mention the popularity of disruptors such as Airbnb.
ZOOPLA PROPERTY GROUP
JP Morgan Cazenove downgraded its stance on Barratt Developments yesterday, but said that dropping the blue-chip residential property development firm to “neutral” from “overweight” was a “valuation call” and that the outlook for the FTSE 100 stock nevertheless remains positive. The JP Morgan Cazenove team said they expect 2016 to be another profitable year for the UK housebuilding sector, yet added that they see the most value in firms with smaller market caps.