I know plenty of people smarter than me are on holiday at the moment, but I am still locked into the global corporate earnings season. That is a bit boring I know, but it is also fun and interesting for an investment sad sack like me. A couple of UK-listed names capture my attention this morning, starting with the owner of some flashy (and some slightly less flashy) hotels, InterContinental Hotels Group (IHG).
Hello Share Choosers. Having just returned from an exotic weekend break in Doncaster, I can attest that the hotel trade is even healthier than it was before Covid. There are a lot of people travelling and partying as they work hard to make up for lost time. I treated myself to a stay at the famous Earl of Doncaster for a golden wedding, but like most folks I usually choose something at the cheaper end of the market. Like Travelodge or Premier Inn.
I have sometimes stayed in InterContinental Hotels Group (IHG) properties, but I am famously much more of a Premier Inn / Whitbread (WTB) sort of guy if I am elsewhere in this country. As for international trips, I would regard International’s Holiday Inn as luxury…but I am sure that its senior management team knows just a little bit about its Regent and Crown Plaza offerings. However, International’s group CEO Keith Barr may soon have evolve his choice of travel preferences as he is “to step down and to be succeeded by Elie Maalouf, Americas CEO InterContinental Hotels Group.
I am such a fanboy of Whitbread (WTB), the company most of us know today as the owner of Premier Inn hotels. A number of years back I made a really solid return, especially after Coca-Cola purchased Costa Coffee off it for a decent amount of cash. I sold most of my shares during that time period, but joined in its money raising during the early days of COVID-19 as it sought to ensure Premier Inn focused business was going to be able to keep growing, not just in this country but also in Germany where it sees material future prospects. And that brings us to today’s “FY23” numbers.
I am looking forward to this week. Whilst I have no idea whether the weather will be good or bad, I do see a bunch of fascinating upcoming corporate comments and statements from Wednesday. The realities of Christmas trading will start to become apparent as well as a few hopes for FY23 earnings progress (or not).
Many of you have probably stayed in an InterContinental Hotels Group (IHG) hotel. I am sure a bunch of you are fans of the Regent or Crowne Plaza options, but I am a bit more of a Holiday Inn sort of guy. As for the company’s shares, I have not owned them for years but, when I look at their performance over the last year, they are 10% or so below the c. 5000p share price average. How exciting (not).
Hello Share Pickers. You don’t hear much about shareholder perks these days. But one company still handing out discounts to its investors is Whitbread (WTB). Staying at one of its Premier Inns, they and the family get a free breakfast. Which isn’t, of course, a good reason to buy the shares.
Another exciting day in the markets, although at least today they are up…until we see what the central banks on either side of the Atlantic have to say for themselves over the next 24 hours or so. All good fun (as always). Meanwhile two workable updates today from Whitbread (WTB) and WH Smith (SMWH)...
How are your domestic holiday plans for this year? Given all the airport hassles, what could be nicer than a holiday in the (no doubt rainy) UK? I am sure Premier Inn owner Whitbread (WTB) would completely agree with such thoughts. So, does that make the stock cheap?
When I last looked, Whitbread (WTB) shares were in the top ten of my personal pension fund positions. I have been a fan at various levels for years, having enjoyed the share price bump after Coca-Cola purchased the company’s Costa unit at a decent multiple to take a decent profit, and then invested it back into the share when the Premier Inn owner decided to raise some money back during the 2020 COVID-19 uncertainties. I may not have made it one of my formal two tips of the year during the Christmas holidays, but I am still hopeful of a return to a c. 40 quid share price as I discussed back in June last year. So what do I make of its Q3 update today?
A week into January and I see that the weekend press has plenty of stories about the European Central Bank executive who ‘warns green energy push will drive inflation higher’, as well as the UK’s former vaccines minister who said it would be ‘helpful’ to cut the self-isolation period to five days. Otherwise there is the apparent hassle of the wealth of the top 1% is 230 times higher than the poorest 10%. Such analytical excitement (not).
Like the complete weirdo I am, I do like doing a bit of sector research now and again. I do find it strange that whilst fundamental caution towards fixed income markets still makes a lot of sense, technical (rather than fundamental) bullishness for equity markets seems to have become more important. Typically active management and fundamental investment rationales are akin to one another, as is passive management and technical investment preferences. And then I read that more investors now believe that the S&P 500 – by the end of the year – will not only hit a number of all-time highs above the level achieved in 2017 (62 all-time highs) but also the all-time high of 77 achieved in 1995. No doubt too many of such people are overly excited by Tesla’s market cap reaching $1 trillion and tripling this (or more!) by the end of the decade. As if. Anyhow, back onto stocks I really care about. Three names my pension fund owns have reported today and – very nicely – all are doing rather well (and I think there is more to come).
I read in today’s press that ‘British Telecom (BT.A) has picked the former chief executive of Royal Mail (RMG) and ITV (ITV) to be its new chairman…Adam Crozier is expected to resign as chairman of the online fashion retailer Asos (ASC) to focus on the role, although he is tipped to stay on as chairman of Whitbread (WTB)’. How exciting!
Naturally you have to think carefully about every share in the travel sector at the moment. Earlier this week I wrote why I thought On The Beach (OTB) was wholly uninvestable HERE. By contrast I still own shares in Carnival (CCL) and, as I talked about last month HERE, I will even get back to making a bit of profit on my holding if the shares go up another couple of quid and there was an announcement today that its ‘ultra-luxury cruise line’ brand Seabourn would depart for both the Greek Isles and the Southern Caribbean next month. Certainly there is a bunch of older (and richer) people who look forward to their next trip soon. My top sector holding in the travel and related space though is Whitbread (WTB).
Whitbread (WTB) is a share I have owned successfully for a while and noted back in January here that I still targeted a 4000 pence share price. Whilst the shares have moved up from 3050 pence in early January, today they are down 4% or so at 3260 pence. Still workable but why has the Premier Inn, Beefeater, Brewers Fayre and Table Table owner fallen back a couple of quid plus since the high of the year?
Hello, Share Poolers. This old punter has Whitbread shares. It owns the Premier Inn, so must have suffered mightily during the lockdowns. As they’re gradually clawing back some of their old values, I won’t sell them. But once the present rising trend gives way to any weakness, I’ll probably let go. Nor will I buy any shares in the hospitality game probably for some time.
Obviously I am a complete sad-o at many levels, one of which includes my love of taking the family to stay at a Premier Inn Hotel. Sadly, taking a trip to a different part of the country has been slightly tricky in the last year for obvious reasons but hopefully it is all going to be a bit different in six months time or so. The update today from Premier Inn owner Whitbread plc (WTB) admitted to a few challenges but leaves me optimistic still on the shares, even if their move over the last six months has gone from near twenty quid a share to today’s level of over thirty-one quid a share.
Hello Share Funsters, We were all cheered when vaccine news from Fizer sent shares shooting forward a few days ago. But the value of my own portfolio was disappointingly unchanged. That’s because I have a few Covid plays. And because the jab news depressed the prospects of companies which have benefitted from the epidemic, the rise in the value of my Shell (RDSA) BP. (BP.) Compass (CPG) and Whitbread (WTB) was cancelled out by my covid plays.
In the wider scheme of things, no huge surprises in today’s first half numbers from Premier Inn owner Whitbread (WTB). You will recall my history with this one – I took big profits thanks to the largesse of Coca-Cola in buying Costa at a material premium (how’s that one working out I wonder?), but then backed the rights issue and even last time observed I would increase my stake even further at twenty quid a share. I did not get that opportunity but market moves and shifts might still give me that opportunity as pandemic angst continues. Today’s update builds on the bare bones of the trading update I wrote up a month or so ago at the link above…
Back in July I observed why worrying about an 80% like-for-like revenue decline at Premier Inn owner Whitbread (WTB) was not an investment-stopping concern for me. I even concluded that, buoyed by the monies raised from this year’s rights issue, ‘I retain my decent sized position and ceteris paribus would add more at around twenty quid’. We will come back to that latter observation later. But today’s first half trading update (for the six months to the end of August) does show a little improvement…
‘Nothing exists in a vacuum’. This was drilled into me as a neophyte analyst and it is why I continue to spend a significant amount of my time thinking about macroeconomic issues and how they impact the risk environment for individual stocks…
Regular readers will recall I cheered Coca-Cola's largesse in splurging on the Costa Coffee chain from Whitbread (WTB) and hence when the company wanted some of those distributed returns back a month or two ago to invest into its Premier Inn hotel range, I was supportive – observing that 'a crisis is an opportunity and with many hotels struggling to survive, Whitbread pounds (or in Germany euros) can go a long way in terms of locations'. And it certainly is a general crisis...
Over the weekend I hope to bring you photos of a semi complete strawberry patch here at the Welsh Hovel and also of my first long training walk for Woodlarks. I donated £1000 yesterday and young Steve Moore also made a generous gift so we are now at 24% of the £48,000 we need to ensure Woodlarks survives. Please donate HERE. In the podcast I look at Whitbread (WTB), Catenae (CTEA) and at where we are in the gold shares buying cycle, referring to three I own and am very excited: Bluebird Merchant (BMV), Kefi (KEFI ) - no sniggering at the back please - and Xtract (XTR). Again no sniggering.
Normally a preliminary results announcement would be of the uppermost interest when thinking about the daily newsflow grind around a FTSE-100 company. However, for Whitbread (WTB) today its own preliminary update is superseded by a rights issue announcement from the owner/operator of the Premier Inn franchise. A rights issue! In the current era of placings, it felt like a blast from the past to have a table showing the indicative timing of events...
I have loved up Whitbread (WTB) shares many times on this website, most recently here where I noted it was trying to do the right thing for their employees. Friday's short regulatory update - which confirmed that the company was an 'eligible issuer under the UK Government's Covid Corporate Financing Facility (CCFF)' also noted 'as at 16 April the business has accessible cash reserves of c.£400 million and access to £900 million of its existing committed Revolving Credit Facility (RCF)' which certainly gives them a bit of time and flexibility.
Let's face it, nobody really knows but you do not need to be an investing genius to know that Sunday newspaper headlines about the lockdown persisting until June is not good news if you are an investor or an entrepreneur. Yes, you can push out a bunch of mitigation tactics and - yes - governments and central banks are stepping up, but the longer this period of time goes on for, the harder it gets for everyone.
Hello, Share Diggers. When I was looking for a hotel in the Smoke last month, I was shocked that Premier Inn, a so-called budget hotel, wanted £360 for two nights, a huge increase on my room last year. I bet they’re not charging that now. This brings me no joy, especially as this family has shares in Whitbread (WTB) which owns Premier.
Yet the one or two deaths it brought to Britons become headline news. Can you possibly imagine every flu death being treated in the same way? Meanwhile, there are signs of that China, the source of the outbreak, is seeing a drying up of cases. That’s surely likely to happen everywhere.
I read a good bit of investment advice the other day - yes, despite almost a quarter of a century as some kind of professional investor I am still learning. It noted that 'if you're a very rare trader with edge, you'll act according to your strategy...if you're one of the majority of traders with no edge, this volatility may be revealing'. Goodness I wish I had exhibited sufficient knowledge and accrued insight to have written that. It is very true in my opinion.
So hello to the first big corporate updates day of 2020. So much I could write about (and if tomorrow is a bit quiet, I might do a part two) but three names I wanted to share some thoughts on as I have mused on them on this website in recent months…
I am playing a bit of catch-up today but my first port of call has to be yesterday's interim numbers from the Premier Inn and Beefeater owner Whitbread (WTB), which I have loved-up many times on these pages. Helpfully it sold off Costa for a pretty penny but the share has been a bit desultory year-to-date, including failing a couple of times at the c. fifty quid level. In a way I am almost surprised it did not fall more yesterday…
I enjoy using the search function on this website because you can always learn something from articles written months or even years ago. Almost a year ago I wrote on international hotel chain InterContinental Hotels Group (IHG) that 'the company changed its CEO last July. The new incumbent is clearly trying to forge a distinct direction rather than live just off the legacy of his highly successful predecessor. That can be a dangerous thing to do too at the wrong point of the economic cycle'. That all seems very true, but the reality is in the last year the share has gone up. However reality is not so different…
Hello, Share Clangers. When I’m away on business, which is rather too often for my liking, I prefer to stay in Premier Inns. My reason is not that I think they’re great but that because, as a shareholder, I nab two nights for one at weekends. However, I don't hold the shares for this handy perk, but because the room prices are comparatively cheap – which is what stingy customers want these days...
Like the investment sad-o that I am, I spent a good while yesterday afternoon pacing through the one hundred plus slides that formed the Whitbread (WTB) capital markets day presentation. Recall - as I have written up at length before - that the company is now all about the Premier Inn asset after Coca-Cola's largesse in buying Costa Coffee for a pretty sum. Right at the back of the presentation document Whitbread noted that it would return over £2.5 billion of the £3.9 billion proceeds back to investors – which is not a bad slice of the cake. Meanwhile industrial and pension debts/deficits get lowered further...and the company can also easily finance its expansion plan…
Hello Share Treaters. As a customer of Premier Inn hotels and not a coffee drinker in Costas, I was pleased Whitbread (WTB) has just sold its coffee places to Coca-Cola this month. Costa coffee shops always look a bit bland to me with few of the quirky attractions offered by independent purveyors. While Premier Inn hotel rooms are very reasonable and convenient in city centres. Plus, if you are a shareholder, you get two nights for the price of one at weekends.
Back in the day, I used to be an institutional fund manager and did go on a number of brokerage lunches at around this time of year. The essential underlying aim of these lunches did not change for years: a thank you for business given during the year...and a pitch or ten about stocks that could be bought (or sold) early the next year in order to keep that commission flow going (and from the broker's perspective hopefully building). It seemed to me that the ideas took a very simple form: buy the underperformers and sell the outperformers. Well who does not like a bargain or - indeed - to take profits? So from an akin premise - but with an added slice of cynicism (and no need to elicit your brokerage commission flows!) - what does a 'brokerage lunch list' throw up as interesting in December 2018 looking ahead into 2019?...
As I have noted before, it is probably a good thing that the UK economy is not based on my personal consumption habits, especially when the highlight of my annual 'pre-Christmas trip to the shops' was purchasing an advent calendar marked down from its original price by over 75%... A very cheap way to buy some good quality chocolates (and - naturally - to ascertain the quality level I had to consume days one to fifteen in one sitting).
As I described a couple of months ago HERE, one of my investing highlights of 2018 has been the bid by the soda behemoth Coca-Cola for the Costa Coffee business of Whitbread (WTB). This left the FTSE-100 name with one major asset, its hotels business Premier Inn...and a bunch of speculation about whether it would look to encourage bids for this asset too...or use some of its windfall to accelerate the growth of the value-centric hotel brand.
I have never actually written about Intercontinental Hotels Group (IHG) but I note the shares are down over 7% as I write. The company - best known for its Crowne Plaza and Holiday Inn brands - said in an update today that 'the fundamentals for our industry remain strong. We are confident in the outlook for the remainder of the year and in our ability to deliver industry-leading net rooms growth over the medium term'. And to show this optimism it even announced a $500 million special dividend, equivalent to 5% of the current market cap. Not too shabby for a share that already yields 2.5%. Fair enough and with Q3 YTD RevPAR (revenue per average room) up 2.7% at least the numbers are moving forward too. So why the big fall?
A pretty poor first trading week of September has got the press all flustered with talk of the FTSE 100 being at five-month lows. Older stock market hands of course know that this is when it starts to become interesting, after all it is better to buy low and sell higher than the other way around.
Hello, Share Markers. I admit it. The reason I bought into Whitebread (WTB) a year and half ago was to bag the shareholder perk of one night for the price of two at its Premier Inns. With it came money off at its various restaurants and a voucher for coffee at Costa.
Back in the day, the last business day of the month was always a rather important moment for me because it would determine whether I was a hero or a zero in the institutional investor world I used to belong to. Believe me, in the emails and related that followed, the whole investment firm would know whether your Fund had done well or badly. Of course the way to build performance was one month at a time, so a 'good close' to the month was immensely useful. If I was still in that world - and invested akin to my thoughts today - then I would have a big beaming smile on my face, thanks to the news update from my old mucker Whitbread (WTB) whose shares I have been continuously loving up on this website (most recently HERE)…
It has been a busy last few weeks grappling with the global results season, so i had a couple of quieter days on Friday and Saturday and, at one point, found myself at a newish shopping centre half-an-hour or so from where I live. I do not find the idea of retail therapy particularly exciting or refreshing but as I am in a minority of one on this...unto the breach and all that. It was not long before i cheered up pointing out my perceptions on which retail outlet was doing well or badly based on footflow, the look of the store etc, etc. I am not sure if my daughters were particularly interested in all this...
On a thin regulatory news day, two board member announcements catch the eye. I have never written about internet clothing retailer ASOS (ASC) on this website before but i did once own the shares following a tip from a mate who liked the look of a small cap called 'As Seen on Screen'. I remember feeling rather clever after making a very decent return after selling out at 10 pence... Ah, the shortcomings of youth!
Hello, Share Saddlers. I’m ashamed to admit that one of the main reasons I bought Whitbread (WTB) shares is that it came with a deal for two hotel nights at Premier Inns for the price of one. We are testing the waters on this one with a romantic weekend break later this month.
A couple of larger cap favs of mine to write about today following new newsflow. I see that the ITV (ITV) COO/CFO has decided to exit into the night and retire. He has been at the company for a decade and no doubt he has made a pretty penny for his efforts. I do not think there is any particular fire here and he will hang around until a successor has been appointed. However my instinct is that there is another story here.
I read in today's Sunday Times that: 'An activist hedge fund has opened fire on the boss of Mr Kipling cakes maker Premier Foods (PFD), accusing him of leading the company into a "zombie-like state" through "five years of failure" '
I concluded my last write-up on Premier Inn and Costa Coffee owner Whitbread (WTB) hoping for an event inspired by both activist shareholders on the company's ownership register and the new right-on Chairman Crozier who previously had set a fire below both ITV (ITV) and Royal Mail (RMG). Well today - finally – it delivered with the announcement that 'Whitbread will pursue a demerger of Costa, providing shareholders with investments in two distinct, focused and market-leading businesses'.
I seem to have written about one of my 2017 'tips of the year' Whitbread (WTB) more in 2018 than I did during its twelve months in the sun. A couple of weeks ago I observed that the appointment of the new Chairman, combined with an activist shareholder on the books could well tip the company over the edge in terms of thinking about the value creation option of splitting its two largest and most successful franchises Costa Coffee and Premier Inn. I also mused that the market reaction to this would push the shares back to trading at £50+.
Once again Tim Martin of JD Wetherspoon (JDW) is the hero of the day exposing the lies, for that is what they are, spouted by big business and the dishonest media on the subject of Brexit. Martin lets rip in his company's latest trading statement. A true hero writes:
Whitbread (WTB) has had an up-and-down year since my last update on the stock - HERE. The Costa and Premier Inn operator unsurprisingly has been impacted by the changes in perception towards the strength (or not) of the UK consumer and this has pushed the shares between a £36 and £42 range this year. Today's interim results have again pushed the shares towards the lower end of this range despite the company reiterating its hopes for the full year.
Hello Share Screechers. It was a bonus when I bought some Whitbread (WTB) shares and found I could wangle hotel accommodation at half price. Well, actually, the deal for shareholders is you and yours get a free Sunday at a Premier Inn if you stay on a Saturday night. Up to two rooms are on offer. Here are some other share perks you might like.
If I told you that UK clothing retail behemoth Next (NXT) mentioned this morning that earnings per share for the current financial year were now estimated to be down between 3.1% and 10.9% you would probably not want to buy the share after muttering about the downbeat UK consumer, nobbled by a lack of real wage growth and a slumped Pound. Well you would be quite correct in not wanting to buy Next shares today...because with the stock up a cool 11% it is once again pushing close to the 50 quid a share level I hoped for as a share price target in my writings on the stock earlier in the year (for example HERE).
Is the UK consumer completely shot? For the last year we have had a waxing and waning in views from 'the experts' on this. The reality is that it depends who you talk to but, biggest picture, what is needed is a great product, attractive marketing and a base underlying need. I last chatted through the Whitbread (WTB) investment case in late January, where I concluded that the stock was still worth a punt...
Hello Share Samplers. I’m quite excited about this. This family has now received its Whitbread (WTB) shareholder’s discount card. A good investment that, as I’ve only held the share a few weeks and am already up by 12%. And the added perk is really quite good, as shareholder discounts go.
First trading update of my (long) tip of the year for 2017 and the shares are down 4%. Worried? Of course not…the Whitbread (WTB) share price is still nicely above where I recommended it…and frankly we are not even a month into the year. The magnitude of the move today reflects the (to use a wonderful phrase poached from a fellow market observer) wildebeest financial market backdrop we have at the moment…
If you want to buy just one new single stock in the FTSE-100 for 2017 you need to look at the perceived Brexit losers given, over the course of the next 12 months, Brexit apocalypse will move further away via delays and position dilution. Forget big overseas earners as this backdrop will crimp their translated back into Sterling earnings so it has to be more domestic plays. And filtering for market leadership, strong balance sheet and continued growth hopes I end up with Whitbread (WTB) the owner of the Costa Coffee and Premier Inn franchises.
Marketing services group, St Ives (SIV) has made a “Trading Statement” announcement including that results for its year ended 29th July 2016 “are expected to be in line with current market expectations” - and the shares are currently approaching 24.5% higher, at 122.25p, in response. Hmmm…
Hello Share Thumpers. The big hotel and catering set-up Whitbreads (WTB) has had an encouraging write-up in my modest column before. If anything my enthusiasm has increased since then. The first three months of this year were promising both for its hotels and for its Costas, the Italian- sounding, but not, chain of coffee houses, which seem to be springing up everywhere.