Barclays downgrades Fever-Tree after profit warning

Barclays downgraded tonic maker Fever-Tree on Tuesday to ‘equalweight’ from 'ovewrweight’ following its third profit warning in six months.

"Whilst many may perceive this to mark trough profitability, we lack conviction in the guidance," the bank said.

"Fever-Tree expects inflationary pressures to persist but will not take pricing until FY23E, whilst competitive pressures are expected to be intensifying and consumers slowing down.

"We continue to like Fever-Tree's long-term opportunity but until our confidence in margins can be restored, we believe near-term headwinds will overshadow long-term growth."

The bank slashed its price target on the shares to 1,000p from 3,030p.