Morgan Stanley says CCH and Britivic shares not reflecting pace of recovery

To back up their case for their former, they pointed to the latest mobility data from Google, judging that it pointed to a faster recovery in the backhalf of 2020 than for peers.

There were also long-term "structural growth opportunities" to be grasped in the case of CCH.

Over the short-term, improved product mix and the "partial retention" of €100m of costs savings should offset the drag from taxes on sugar and plastics, boosting earnings before interest and tax, they said.

And while valuations for both firms "were not reflecting a pace of recovery that should be at least as good (if not better)vs alcoholic bevs", at just 14 times its estimated earnings for 2021, Britvic's stock was the "cheapest".

"We see no good reason for this," Pinar Ergun and Yubo Mao said in a research note sent to clients.

They estimated that the sub-sector was set to see 2021 earnings per share recover to over 95% of their level in 2019 and a compound annual rate of growth in earnings per share of 7-12% from 2021-25, with premiumisation driving a structural re-rating longer-term.

In the same note, they also reiterated their 'equal-weight' recommendation for Fever-Tree, forecasting a AGR in average sales of 12% from 2021-25.