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Accor Upgraded to Overweight by Morgan Stanley on 2027 Growth Outlook
Morgan Stanley has upgraded French hotel operator Accor SA (ACCP) to "Overweight" from "Equal-weight," naming it a Top Pick based on an anticipated inflection point in 2027. The brokerage raised its price target on the company's shares to €55 from €51, citing an improved outlook for revenue, unit growth, and cash returns to shareholders.
Following the report, shares of Accor were trading up 2.5% as of 09:13 GMT.
The Path to 2027
Morgan Stanley's upgrade is centered on the expectation that Accor will see significant operational improvements in 2027, which will outweigh current headwinds. The analysts highlighted a recovery in Revenue Per Available Room (RevPAR) as a key catalyst, forecasting growth to accelerate from 2.3% in 2026 to 3.5% in 2027.
This improvement is expected as weak comparisons from the Middle East, a key market for Accor, begin to annualize in the second quarter of 2027. The region, which accounted for about 12% of Accor's fees in 2025, saw significant RevPAR declines in the second quarter of 2026. The brokerage also projects net unit growth will improve from 3.4% in 2026 to 4.1% in 2027 and 4.3% in 2028.
Shareholder Returns and Valuation
A substantial increase in cash returns is a core part of the investment bank's thesis. Morgan Stanley anticipates total distributions to shareholders will exceed €1 billion over the next 12 months, representing approximately 10% of Accor's market capitalization.
AdThis includes:
- A €500 million program funded by Essendi.
- A further free cash flow-funded buyback of about €0.4 billion.
- A €0.3 billion dividend.
The analysts noted that Accor currently trades at a valuation of approximately 11 times EV/EBITDA, a discount of roughly 25% compared to its asset-light peers such as IHG, Hilton, and Marriott.
Near-Term Risks and Other Factors
Despite the positive outlook, the report acknowledges several risks. These include a potentially soft Middle East market through early 2027, weaker net unit growth relative to peers, and uncertainty surrounding management transition, as CEO Sébastien Bazin is set to depart by May 2028.
Accor is also reportedly exploring a potential listing of its lifestyle business, Ennismore, with a decision expected by the end of the third quarter. Morgan Stanley flagged that press reports have cited a potential enterprise value of €3.2 billion for the unit.
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