Restaurant Group (LON:RTN) has been hit with a downgrade by JP Morgan just days after it was allowed partially to reopen again.
The Wagamama owner’s expected recovery from the government’s recovery roadmap is already priced into the shares said the broker.
JPM has upped its price target, to 120p from 95p, but says that as this is close to current trading levels it leaves limited upside.
The new target and multiples based on its earnings forecasts ‘fairly capture the company’s strong efforts to weather the COVID-19 storm, but also price in recovery from here to pre-COVID levels ib the year to March 2022’ the bank said in a note.
“In the absence of further upside to this scenario, we downgrade the shares to Neutral from Overweight.
“In our view, future catalysts could be results evidencing the speed of recovery.”
Shares dropped 4% to 118.4p.