InterContinental Hotels: Attractive Valuation and Growth Prospects Justify Buy Rating

Bank of America Securities analyst Muneeba Kayani maintained a Buy rating on InterContinental Hotels (IHG – Research Report) today and set a price target of p10,700.00.

Muneeba Kayani has given his Buy rating due to a combination of factors that highlight the potential for InterContinental Hotels’ stock to perform well. Despite concerns about a potential slowdown in US demand, the company’s shares are trading at a 9% discount compared to its US peers, which is wider than historical averages. This discount is seen as unjustified given IHG’s strong returns on invested capital, projected earnings growth, and potential for cash returns.
Furthermore, while there are fears of a US demand slowdown, current data shows resilience in US revenue per available room (RevPAR), and IHG’s significant exposure to the Americas market positions it to benefit from any positive trends. The company’s high returns and growth prospects, combined with its current valuation, make it an attractive investment opportunity, leading to the reiterated Buy rating.

According to TipRanks, Kayani is an analyst with an average return of -7.4% and a 55.13% success rate.