Deutsche Banks starts Tui coverage with 'hold' rating
Deutsche Bank recommended sticking with Tui shares as it initiated coverage of the world's biggest travel and tourism company.
The bank gave Tui's shares a 'hold' rating with a price target of €4.40 or 375p.
The Anglo-German tour operator has been hit hard by Covid-19 restrictions, which have crushed the market for foreign holidays. In March the company trimmed its capacity for the peak summer months to 75% of 2019 levels from 80% though it said bookings were encouraging and showed strong pent-up demand for travel.
"Tui is a fully integrated leader in the tour operator business in Europe, with the markets and airlines divisions funnelling traffic to the holiday experiences divisions," Deutsche analyst Andre Juillard said in a note to clients. "Tui is a highly seasonal business, with almost all of its full-year profits earned in Q4 (Jul-Sep), giving the group's earnings a skewed risk profile if the environment remains as it is now."
Shares of Tui fell 1.1% to 392.8p in London at 10:49 GMT.