JPM favours gaming, hotels as it outlines leisure view for 2025

Elior SA

29/11/2024 09:47

** J.P.Morgan highlights gaming stocks' strong momentum and
hotels' resilience as it outlines a cautiously positive 2025
view for European leisure
    ** It sees more mixed prospects for catering and meal
vouchers, with defensive opportunities among UK pubs
    ** JPM's preferred sub-sector is gaming, where robust online
platforms and relatively easy H1 comparisons should drive
top-line growth
    ** Regulatory clarity in key markets like Britain supports
this growth, while consistent consumer engagement boosts digital
and retail formats, it says
    ** Its gaming top pick is Flutter Entertainment  FLTRF.L 
thanks to its global scale and product innovation, followed by
Italy's Lottomatica  LTMC.MI  and Greece's OPAP  OPAr.AT 
    ** JPM sees steady recovery for hotels, with normalized
travel demand and strong USD driving American tourism
    ** Accor  ACCP.PA  stands out with improved execution and
potential value from disposal of AccorInvest, while Whitbread
 WTB.L  benefits from stable UK operations and German expansion,
it says
    ** It downgrades IHG  IHG.L  on valuation concerns and lack
of catalysts
    ** Catering is pressured by inflation and slowing corporate
recovery in Europe, it says, but upgrades Elior  ELIOR.PA  on
its recovery potential 
    ** Regulatory uncertainties weigh on voucher firms; JPM
favours Edenred  EDEN.PA  thanks to its resilience and cash flow
generation
    ** Marston's  MARS.L  is its top pick among UK pubs,
benefiting from suburban focus, margin recovery and deleveraging
    
RATING CHANGES:
 COMPANY     RATING         OLD RATING
 Accor       overweight     neutral
 IHG         underweight    neutral
 Elior       overweight     neutral
 Edenred     overweight     neutral
 
 (Reporting by Johan Bodinier)
 ((johangeorgesroger.bodinier@thomsonreuters.com))