The Week In Review: No-frills hotels power success of Whitbread

Whitbread has struck gold with its no-frills Premier Inn hotels. Occupancy is at a best-ever 82.7 per cent, fuelled by demand from business travellers. It is now aiming for another 10,000 rooms via new openings and acquisitions. This week's trading update showed impressive growth from Premier, while Whitbread's Costa coffee shops sharpened the taste buds with sales up sharply, mainly due to new openings. Despite indigestion in its restaurants arm, Whitbread remains a solid defensive stock. Buy.

Game Group

Game Group is riding the crest of the current wave of video games console demand, with demand for the Nintendo Wii driving its growth. The company has also received a welcome boost as its acquisition of rival Gamestation has been cleared by regulators. But Game warned this week that a higher proportion of hardware sales will reduce margins. However, this should be priced in.

Thomas Cook

In June, the package holiday groups MyTravel and Thomas Cook got together to cut costs and strengthen their market positions across Europe. Early evidence suggests the merger is going as planned. The savings are set to be better than expected, while the group has overcome tax difficulties and is on track to buy back around 266m of shares. Trading appears resilient with only the US showing weakness. Hold.

Johnston Press

If, as widely believed, newspaper advertising is a good barometer of the strength of the economy then the forecast remains chilly. Johnston Press, one of the country's leading regional newspaper publishers is witnessing an improvement, but there are doubts it is sustainable. Analysts believe advertising will, at best, increase by 2 per cent but could be flat. It still looks too early to chase this company's shares.

Raymarine

Has the credit crunch started to hit the really rich? Raymarine makes a range of electronic marine gear such as navigation equipment and rich men's toys such as fishfinders and under water cameras. As well as a strong pipeline of new products the company is mopping up a number of its distributors. The shares look set for fair weather. Buy.

Mears

Shares in Mears, which repairs council houses, have lost their way recently, which may have something to do with the market's concern over the long-term intentions of the chairman Bob Holt. He sold the bulk of his shares and handed over the reins to a new chief executive, before returning to the post last year. To underline his commitment, he has agreed an option package. The shares do not look expensive. Buy.

Southern Cross

Southern Cross Healthcare is the largest provider of care-home services for the elderly. Growth has been rapid in a sector where it is essential to have scale in order to drill down costs. Despite turmoil in credit markets, Southern bankers are giving full backing to its growth ambitions. The shares have performed strongly since floating in 2006. Southern should soon head north again. Investec has a target price of 832p.

Benfield

The headwinds which buffeted the reinsurer Benfield Group during the first half of the year have shown no signs of easing. The shares buckled this week after a warning that a weak dollar and softer prices within the reinsurance sector were blowing it off course for the full year. Scope for any significant upside in the short term appears unlikely.

FKI

As a result of a cumulative loss of contracts, FKI's Logistex unit will record sales 15 per cent lower than expected in the second half, and profits will also be hit. The warning comes only two weeks after FKI guided toward improved growth, but more importantly, it reduces the attractiveness of the Logistex division, which FKI intends to spin off or sell. Its shares look set to underperform for some time.

Serco Group

Perhaps best known for running the Docklands Light Railway and the country's nuclear warning systems, Serco, the outsourcing specialist, is one of the most successful in its sector, consistently achieving double digit sales growth. Due to profit taking, shares in Serco recently slipped back from a high of 515p at the beginning of May which means they are now within the buying range.

GKN

Engineer GKN has a thriving order book and should start to feel the benefit of a three-year cost cutting drive of its automotive operations soon. Its shares have fallen due to jumpy investors worrying about its exposure to the US market. But some believe these fears are already priced in, and the stock could now bounce. Hold for now.

Mulberry Group

Women love handbags and many are prepared to pay as much as 1,000 for designer ones like Mulberry's. Though growth has slowed recently, sales are still up 9 per cent. Mulberry has ambitions to be a global British brand along the same lines as Burberry. The signs are it has a good chance of succeeding. Buy.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Ashdown Group: Editor-in-chief - Financial Services - City, London

    £60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...

    Guru Careers: Pricing Analyst

    £30 - 35k (DOE): Guru Careers: We are seeking a Pricing Analyst with experienc...

    Ashdown Group: Treasury Assistant - Accounts Assistant - London, Old Street

    £24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...

    Ashdown Group: Sales Team Leader - Wakefield, West Yorkshire

    £21000 - £24000 per annum: Ashdown Group: The Ashdown Group has been engaged b...

    Day In a Page

    Revealed: Why Mohammed Emwazi chose the 'safe option' of fighting for Isis, rather than following his friends to al-Shabaab in Somalia

    Why Mohammed Emwazi chose Isis

    His friends were betrayed and killed by al-Shabaab
    'The solution can never be to impassively watch on while desperate people drown'
An open letter to David Cameron: Building fortress Europe has had deadly results

    Open letter to David Cameron

    Building the walls of fortress Europe has had deadly results
    Tory candidates' tweets not as 'spontaneous' as they seem - you don't say!

    You don't say!

    Tory candidates' election tweets not as 'spontaneous' as they appear
    Mubi: Netflix for people who want to stop just watching trash

    So what is Mubi?

    Netflix for people who want to stop just watching trash all the time
    The impossible job: how to follow Kevin Spacey?

    The hardest job in theatre?

    How to follow Kevin Spacey
    Armenian genocide: To continue to deny the truth of this mass human cruelty is close to a criminal lie

    Armenian genocide and the 'good Turks'

    To continue to deny the truth of this mass human cruelty is close to a criminal lie
    Lou Reed: The truth about the singer's upbringing beyond the biographers' and memoirists' myths

    'Lou needed care, but what he got was ECT'

    The truth about the singer's upbringing beyond
    Migrant boat disaster: This human tragedy has been brewing for four years and EU states can't say they were not warned

    This human tragedy has been brewing for years

    EU states can't say they were not warned
    Women's sportswear: From tackling a marathon to a jog in the park, the right kit can help

    Women's sportswear

    From tackling a marathon to a jog in the park, the right kit can help
    Hillary Clinton's outfits will be as important as her policies in her presidential bid

    Clinton's clothes

    Like it or not, her outfits will be as important as her policies
    NHS struggling to monitor the safety and efficacy of its services outsourced to private providers

    Who's monitoring the outsourced NHS services?

    A report finds that private firms are not being properly assessed for their quality of care
    Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

    Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

    The Tory MP said he did not want to stand again unless his party's manifesto ruled out a third runway. But he's doing so. Watch this space
    How do Greek voters feel about Syriza's backtracking on its anti-austerity pledge?

    How do Greeks feel about Syriza?

    Five voters from different backgrounds tell us what they expect from Syriza's charismatic leader Alexis Tsipras
    From Iraq to Libya and Syria: The wars that come back to haunt us

    The wars that come back to haunt us

    David Cameron should not escape blame for his role in conflicts that are still raging, argues Patrick Cockburn
    Sam Baker and Lauren Laverne: Too busy to surf? Head to The Pool

    Too busy to surf? Head to The Pool

    A new website is trying to declutter the internet to help busy women. Holly Williams meets the founders