Berenburg today lowered its rating on Thomas Cook Group (TCG.L) from BUY to HOLD citing problems with its business model and the ongoing transformation of the company.
Berenburg in a note to investors says “We have never been fans of the TCG business model and have always seen this as a structurally challenged industry,”
The broker described how it had given Thomas Cook Group (TCG.L) a chance and stuck with its positive rating in the hope that with the prospect of positive earnings momentum could be building. However after Thomas Cooks results release on wednesday “made for miserable reading” the broker has now changed its stance on the shares and has slashed its target price to 130p from 165p previously.
Further commenting Berenburg said “Thomas Cook Group (TCG.L) remains in the middle of a transformational restructuring where results thus far are disappointing. To combat the competitive intensity TCG is undergoing, a major reorganisation has been initiated which involves completely reshaping how the company does business. The costs of the restructuring are significant while the steps being taken are not so far seeing any easing in any of the challenges faced”.
Thomas Cook Group (TCG.L) shares are currently trading around 12% down on tuesdays pre results share price at 120p
Berenburg today lowered its rating on Thomas Cook Group (TCG.L) from BUY to HOLD citing problems with its business model and the ongoing transformation of the company.
Berenburg in a note to investors says “We have never been fans of the TCG business model and have always seen this as a structurally challenged industry,”
The broker described how it had given Thomas Cook Group (TCG.L) a chance and stuck with its positive rating in the hope that with the prospect of positive earnings momentum could be building. However after Thomas Cooks results release on wednesday “made for miserable reading” the broker has now changed its stance on the shares and has slashed its target price to 130p from 165p previously.
Further commenting Berenburg said “Thomas Cook Group (TCG.L) remains in the middle of a transformational restructuring where results thus far are disappointing. To combat the competitive intensity TCG is undergoing, a major reorganisation has been initiated which involves completely reshaping how the company does business. The costs of the restructuring are significant while the steps being taken are not so far seeing any easing in any of the challenges faced”.
Thomas Cook Group (TCG.L) shares are currently trading around 12% down on tuesdays pre results share price at 120p
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