Early hesitancy to travel in the early weeks of the Middle East conflict accounted for a weak showing for InterContinental Hotels shares.
However, a series of reassuring updates have demonstrated the company’s resilience, say analysts at investment platform AJ Bell.
May’s first-quarter update included an eye-catching turnaround for the Americas business as group bookings and corporate travel helped make up for a softer showing in leisure travel, and Chinese demand recovered.
According to EY-Parthenon, travel and leisure recorded more profit warnings than any other FTSE sector in the second quarter of 2026, reflecting concerns about geopolitical tensions and the economic outlook.
For now, however, IHG remains upbeat. Unlike many hotel companies, it has an asset-light business model. Rather than owning most of its hotels, it typically manages them or licenses its brands to franchisees. In return, hotel owners pay IHG fees. This allows the company to expand without spending billions buying property, and it has grown rapidly in recent years.
In a recent update, the Holiday Inn owner said any impact from the Middle East conflict would be “more than offset by increases in demand elsewhere”, noting that demand is “heavily weighted to domestic and intra-regional travel”.
The figures support this strategy. IHG’s revenue per available room, or “RevPAR”, increased by more than 4% in the first quarter, with broad strength across all regions except the Middle East.
IHG has also been returning large amounts of cash to shareholders. Its $950m share buyback programme, together with dividends, is expected to return more than $1.2bn to investors this year.
In the first-half results this week, market attention will be focused on whether the Americas’ momentum is being maintained, the extent of any World Cup boost in this region and if a first-quarter rebound in China, which has been a problem area for the group, was a one-off or part of a more positive trend.
With debt costs creeping higher, investors will also be putting some scrutiny on borrowing levels and the extent to which they remain under control and will be keen to get management’s latest take on the situation in the Middle East and whether it is clouding the outlook.
Aviva
Aviva shares are close to 52-week highs as the company prepares to announce its first-half results, with the insurer shaking off a negative reaction to the medium-term targets outlined earlier this year.
While the initial response to the company’s first-quarter update was also lukewarm, investors have come around of late, focusing on the significant growth in the company’s wealth management business and strong sales from the freshly integrated Direct Line business acquired in 2025.
“When marking the card for the first-half numbers, the market will want evidence that CEO Amanda Blanc and the rest of the management team are making good progress against the medium-term targets,” say AJ Bell analysts.
“Any sign the business is not on track could be damaging, particularly given the perception among some observers that the goals weren’t sufficiently ambitious in the first place. Aviva is, to an extent, a victim of its own success here having hit previous targets early.
“The integration of Direct Line and delivery of cost savings associated with the deal will also be under the spotlight and some investors may be hoping for further generosity from Aviva in the form of share buybacks.”
DIARY
Monday 110August
- First-half results from Marshalls
Tuesday 11 August
- First-half results from Genuit and InterContinental Hotels
- UK unemployment claimant count change
Wednesday 12 August
- First-half results from Balfour Beatty
- US CPI inflation
- In the US, quarterly results from Cisco
Thursday 13 August
- Full-year results from Rank Group
- First-half results from Antofagasta, Entain and Savills
- UK GDP
- UK industrial production
- UK manufacturing production
- UK trade balance
- US PPI inflation
Friday 14 August
- First-half results from Aviva
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