Some analysts have suggested for months that G8 will miss earnings forecasts if it is unable to acquire Affinity.
Moelis analyst Garry Sherriff yesterday downgraded G8 to sell. “(They) are solid operators and have demonstrated their ability to lift operational performance across most of their portfolio, however, we sit 6 per cent below 2015 consensus estimates, which appear lofty to us,” Mr Sherriff wrote.
“We believe G8 needed Affinity, else risked 2015 consensus earnings downgrades, we believe this scenario is now likely to play out, and we’re unsure how much more operational improvements can be squeezed out of the existing portfolio.”
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