Jefferies says Shaftesbury, Capco to benefit from rise in consumer spending
Jefferies upgraded London landlords Shaftesbury and Capital & Counties on Wednesday, arguing that they should benefit from a rise in consumer spending once Covid-19 restrictions are eased.
The bank noted that UK households have saved £200bn and said it expects consumers to "make up for lost time" in the second half of the year.
"Hospitality and food & beverage spend collapsed in Lockdown 1 and didn't recover due to fear of infection," it said. "We conclude social spending has the highest rebound potential, and with more than 75% of their businesses in retail and F&B, we upgrade CAPC & SHB to buy (hold) with price targets of 210p (150p) and 660p (525p) respectively."
In the same note, Jefferies also upgraded Workspace to ‘buy’ from ‘hold’, hiking the price target to 930p from 800p.
The bank said 40% of the UK workforce is working from home, with information and communication businesses having the highest rate and food and accommodation the lowest.
"Business sectors, however, aren’t seeing productivity gains after the initial adrenaline rush and few intend to sustain these WFH rates permanently," it said. "We upgrade the short lease London business space Workspace."