Whitbread’s (LON:WTB) share price has taken a hit this Monday as the company wrapped up its buyback programme. The stock is further suffering as The Telegraph reported that hedge funds had taken a £1.5-billion bet against the Premier Inn owner.
As of 14:57 BST, Whitbread’s share price had given up 4.71 percent to 4,671.00p, falling to the bottom of the FTSE 100 index which currently stands 0.07 percent higher at 7,513.88p. The group’s shares have added more than 17 percent to their value over the past year, as compared with about a two-percent dip in the Footsie.
Buyback programme completed
Whitbread announced in a statement today that its £2.5-billion return of capital programme was complete. The Premier Inn owner launched its share buyback in the wake of the sale of its Costa Coffee business to The Coca Cola Company.
“The Company is not planning any further returns of capital,” Whitbread said today.
Hedge funds bet against company
In a separate development, The Telegraph reported over the weekend that Jane Street Global Trading, a specialist high-frequency trading firm based in Manhattan, had the biggest short position against the Premier Inn owner amid warnings that it is poised for a stock market sell-off. The newspaper further quoted data by IHS Markit as showing that in total, some 17.6 percent of Whitbread’s stock is on loan to those betting on the share price falling. Jane Street, however, is the only firm over a UK regulatory threshold requiring short sellers to disclose their positions.
Analysts on Premier Inn owner
The 18 analysts offering 12-month targets for the Whitbread share price for the Financial Times have a median target of 4,625.00p, with a high estimate of 5,750.00p and a low estimate of 2,000.00p. As of July 19, the consensus forecast amongst 23 polled investment analysts covering Premier Inn owner advises investors to hold their position in the company.
Whitbread posted a trading update in June, revealing negative sales growth.