Broker snap: Wetherspoon rating too low says Panmure

11th Mar 2010 11:22

Pub owner JD Wetherspoon's interim results were 6% ahead of broker Panmure Gordon's forecasts, due to a lower net finance charge.Wetherspoon is trading on a current year (2010) P/E of 13.9 times and an EV/EBITDA ratio of 7.1 times. The broker believes this is too low for a compelling roll-out story with a stabilised cost base that is now well positioned to benefit from increasing LFL sales growth and improving margins. Its stance remains 'Buy' with a 600p price target.