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On Wednesday, Berenberg analysts adjusted their outlook on InterContinental Hotels Group (IHG:LN) (NYSE: IHG), citing a challenging environment in key markets. The firm lowered its price target on the stock to £92.00 from £97.00 but maintained a Hold rating. The company, currently trading at $119.32 with a market capitalization of $18.25 billion, maintains impressive gross profit margins of 61%.
Year-to-date, InterContinental’s shares have seen a 15% decline. The stock has experienced volatility within 2025, influenced by investor concerns regarding hotel market conditions in the United States and China, which are critical regions for the company’s operations. Despite these challenges, the company’s first-quarter results demonstrated resilience, with revenue growing 6.47% over the last twelve months. InvestingPro analysis reveals strong returns over both the last five and ten years, with additional insights available through their comprehensive Pro Research Report.
InterContinental’s recent financial performance and commentary on current trading have been somewhat reassuring to investors. The company has confirmed that it is on course to meet consensus expectations for the year, with InvestingPro data showing a solid Financial Health Score of "GOOD." This positive outlook comes even as Berenberg analysts have revised their estimates downward, mainly due to a lower revenue per available room (RevPAR) forecast for the Americas division. According to InvestingPro’s Fair Value analysis, the stock appears slightly overvalued at current levels.
The revision in estimates by Berenberg reflects a conservative outlook, with expectations only slightly adjusted downward by a low-single-digit percentage. The analysts’ decision to maintain a Hold rating on InterContinental’s stock is based on their assessment of the company’s business model’s ability to withstand current market pressures, trading at a P/E ratio of 30.26.
In their commentary, Berenberg highlighted the company’s resilience, which is evident despite the reduced estimates. The new price target of 9,200p represents Berenberg’s revised expectation for the stock’s performance in the face of ongoing market fluctuations.
In other recent news, InterContinental Hotels Group PLC announced the results of its Annual General Meeting, where all proposed resolutions were approved by shareholders. These resolutions included the approval of the 2024 Report and Accounts, the Directors’ Remuneration Policy, and the declaration of the final dividend. The company’s board expressed satisfaction with the support for the Directors’ Remuneration Policy, which was backed by its top shareholders. In a related development, InterContinental Hotels confirmed the Pence Sterling amount for its final 2024 dividend, set at 86.0 pence per ordinary share, with distribution scheduled for May 15, 2025. The dividend is subject to approval at the upcoming AGM on May 8, 2025. Additionally, IHG has released the agenda for the 2025 AGM, providing shareholders with key documents and encouraging advance voting. The meeting will be held at Holiday Inn Kensington in London, with a live webcast available for those unable to attend in person. These developments reflect ongoing shareholder engagement and corporate governance efforts by InterContinental Hotels.
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