Positive outlook boosts Thomas Cook shares

Positive outlook boosts Thomas Cook shares

Morgan Stanley expects Thomas Cook to meet expectations of annual pre-tax profits of £250 million.

The broker said it was “positive” on the travel group, which has “more internal upside and a cheaper valuation” than its peers.

Cook will announce its full-year results at the end of the month and Morgan Stanley said the group was set to meet expectations of pre-tax profits of £250 million as it needs only to report flat profits in the final quarter to hit the forecasts.

“We are positive on Thomas Cook. The shares have been weak of late, driven by concerns around North Africa and the Ryanair profit warning,” Morgan Stanley said.

“While these concerns are understandable, the investment case is centred around internally-driven initiatives rather than externally-driven trading,” the Daily Telegraph reported on Saturday.

The broker added that, as “costs had been delivered at a faster rate than expected”, it forecast that profits would jump to £450 million by 2015.

The supportive note caused Cook shares to climb 8.7, or 6.3%, to 147.4p, making it the biggest riser in the FTSE 250 on Friday.


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