Barclays reinstates William Hill at 'overweight'

It said the stock is cheap and there are potential catalysts in the second half such as announcements around cost savings in retail and online and hopefully news on a new chief executive officer.

“That said, we continue to prefer Paddy Power Betfair given its superior growth, strong balance sheet and strategic optionality,” the bank said.

Barclays noted that William Hill expects full-year earnings before interest, tax, depreciation and amortisation to be at the top end of guidance of £260m to £280m and said it now forecasts £275m versus a previous estimate of £265m.

The bank said there is still a lot to do to turn around the online division and although it has been encouraged by the early progress under the new leadership of Crispin Nieboer, it is still early days.

At the third-quarter results, Barclays is hoping for more detail on cost savings from the reorganisation of the retail division, news of cost efficiencies in the online division and news regarding a new CEO.

“We think all three issues may be a positive catalyst in H2, albeit we think some of the cost savings will be reinvested for growth.”

At 0854 BST, William Hill shares were up 0.3% to 315.70p.