Rating change and valuation
Jefferies has lowered its recommendation on Accor SA to Hold from Buy and cut its 12-month target price to 52 from 55. The broker reduced its earnings estimates by approximately 4%, placing its forecasts about 3% below consensus. Jefferies also highlighted that Accor is trading at roughly 22.7 times next-twelve-months price-to-earnings, a multiple that it says leaves limited room for further upside.
Middle East downturn and RevPAR shocks
A key driver of the reassessment is the sudden deterioration of hotel demand in the Middle East, a region that represents around 12% of Accor's room revenue and 15% of its hotel development pipeline. Industry revenue per available room - RevPAR - plunged 63% in April before improving to a 7.9% decline in May. The United Arab Emirates suffered the steepest monthly drop, with April RevPAR down 78.5%.
Jefferies' base-case scenario assumes a gradual recovery beginning in the second half of 2026, with Middle East RevPAR returning to positive year-on-year growth in the first quarter of 2027. The broker cautioned that its downside scenario would leave earnings estimates about 6% below consensus, while an upside scenario would deliver only around 3% upside - a profile the firm characterised as an unattractive risk-reward trade-off.
Core division performance
Beyond the regional shock, Jefferies pointed to underperformance in Accor's Management & Franchise division, which accounts for roughly 78% of group EBITDA. While revenue increased at a 6.9% compound annual growth rate on a constant-currency basis over 2024-25 - inside the company s 6%-10% target range - reported EBITDA rose just 6.3%, short of the 9%-12% target.
Within that division, the Luxury & Lifestyle segment achieved net unit growth of 7.5%, below its 8%-10% target. The Premium, Midscale & Economy segment saw its EBITDA margin decline to 73.2% in 2025 from 73.8% in 2022, despite the group s strategic emphasis on expanding its asset-light model.
Forecasts and peer valuation
Jefferies projects group EBITDA of 1.26 billion in 2026 and 1.37 billion in 2027, implying growth of approximately 5% and 9% respectively - rates that the broker notes are below Accor s medium-term targets. The new 52 price target translates to about 23.5 times forward earnings and represents roughly a 20% discount to peer InterContinental Hotels Group, according to Jefferies. The broker's bear- and bull-case valuations sit at 36 and 63 respectively.
Implications
Jefferies' downgrade reflects a combination of regional demand shocks and execution gaps in the group's largest margin-generating division. With downside estimates materially below consensus and limited upside under more optimistic scenarios, the brokerage views the risk-reward as unattractive at current multiples.