FTSE 100 shares round-up: BAE Systems, IHG, JD Sports, Relx

A Longreach70 drone used for intelligence, surveillance, target acquisition and reconnaissance at the Defence and Security Equipment International (DSEI) in London in September 2025. Photo: John Keeble/Getty Images.

A fresh retreat by BAE Systems (LSE:BA.) today held back the FTSE 100 index, as investors switched their focus to the re-rating potential of hotels group InterContinental Hotels Group (LSE:IHG) and heavily sold JD Sports Fashion (LSE:JD.).

Other factors in the reverse of the FTSE 100 included disappointment over the reduction in Shell (LSE:SHEL) buybacks to $3 billion (£2.2 billion) and impact of RELX (LSE:REL) and Admiral Group (LSE:ADM) shares being marked ex-dividend.

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Today’s fall of 76p to 2,013.5p by BAE means the defence group’s shares are down 15% on their mid-March peak and below where they stood prior to the start of the Iran war, albeit still 15% higher year-to-date.

The reverse came despite a robust AGM trading update as BAE reiterated the guidance in February’s annual results, including sales growth of between 7% and 9% on last year’s £30.7 billion and underlying earnings per share uplift of 9-11% on 2025’s 75.2p.

It highlighted a supportive backdrop for growth over the medium term, including significant opportunities in space systems, missile and air defence systems, drones and counter drone technology and electronic warfare.

BAE referenced several recent order wins worth about £4.5 billion, which is materially higher than the £1.9 billion disclosed at last year’s equivalent update.

City bank Morgan Stanley, which has a price target of 2,662p, said it regarded a current valuation multiple of 21 times forecast 2028 earnings as undemanding.

The bank added: “We see material upside to forecasts, especially from 2028-29 from expected growth in US and Middle East defence budgets.”

Source: TradingView. Past performance is not a guide to future performance.

A “very strong” first-quarter update today helped the shares of Holiday Inn and Crowne Plaza business International Hotels Group to close the gap to US peers Hilton Worldwide Holdings Inc (NYSE:HLT) and Marriott International Inc Class A (NASDAQ:MAR).

Revenue per available room (RevPAR) rose 4.4%, driven by “notable strength” in the US and further acceleration in Greater China following a recent return to growth.

The key benchmark of net system sales lifted 5% after the opening of 82 properties helped IHG reach the milestone of more than 7,000 hotels.

IHG said the second-quarter impact of the Middle East conflict and disruption to international travel flows is expected to be more than offset by increases in demand elsewhere.

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To date in the second quarter, the Middle East trading performance has moved to an estimated RevPAR decline closer to 50%, with RevPAR down approximately 7% across Europe, Middle East and Africa overall in April. An improvement in trading is seen for May and June.

Bank of America today raised its RevPAR estimate for the year to 3.1%, reflecting the strong demand environment in most global markets and the World Cup tailwind in North America.

The bank also lifted its price target to $166, which represents a multiple of 17.5 times 2027 earnings compared with the current 16.9 times. The shares today traded at $150 for the first time this year, having fallen from $141 to $128 in the first two weeks of the war.

BofA believes the extent of the discount to Marriott on 18.5 times and Hilton at 20.6 times is unwarranted, particularly as IHG is now demonstrating better net unit growth and RevPAR performance than Marriott, and better RevPAR versus Hilton.

It said: “We reiterate our Buy rating - the company is firing on all cylinders, delivering about 15% compound earnings by share growth in 2025-28, with additional re-rating upside potential.”

The shares of JD Sports Fashion bounced 4.4p to 72.4p, even though the retailer reported a 7.7% decline in underlying profits to £852 million for the year to 31 January and gave guidance of between £750 million and £850 million for the current year.

This wider-than-usual range reflects uncertain trading conditions and follows a first quarter where like-for-like sales declined 2.3%. While this was weaker than the City consensus of 1.6%, it covered JD’s quietest quarter in terms of sales density.

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Chief executive Regis Schultz said his focus remained on “controlling the controllables” after the company delivered a resilient performance in 2025-26 results.

He said the retailer would look to build on its progress in North America, which accounts for nearly 40% of all sales, after a return to like-for-like growth in the fourth quarter.

Schultz added: “While we continue to expect muted market growth in 2026-27, we remain confident in JD Group’s medium‑term trajectory, underpinned by our strong brand partnerships and agile, multi‑brand model.”

Today’s share price improvement, which leaves the stock down by about 15% year-to-date, came as JD reported a big jump in its year-end net cash position and announced a 20% uplift in its total dividend to 1.20p a share.

It said it would look to grow this progressively towards a more attractive dividend yield, which currently stands at 1.7%.

Peel Hunt cut its estimates by 5% and lowered its price target to 180p, which it said was driven by retail uncertainty and external factors rather than JD specifics in today’s results.

It added: “The valuation expected a downgrade: in our view, a sub-seven times earnings multiple is far too cheap for a market leader of this quality.