Thomas Cook shares have rebounded after a torrid week, rocketing by as much as a third this morning, clawing back some of the nearly 60 per cent losses in the past eight days.
The boom came as Moody’s downgraded the corporate family rating of the travel agents to B2 from B1 and changed the outlook to negative from stable.
Last week the company issued its second profit warning in as many months, after the hot summer hurt bookings as Brits opted to stay at home to soak up the sun.
Shares dropped to their lowest point in more than five years in the aftermath, but this morning they bounced back by 32.6 per cent to 30.12p.
Moody’s assistant vice president-analyst, Vitali Morgovski, said: “Our rating action reflects the deterioration of credit metrics after unfavourable earnings development in the financial 2018 and the group's weakened liquidity.”
“Furthermore, the negative outlook reflects Moody's concerns regarding the company's ability to recover its profitability and cash generation in the coming fiscal year as the macroeconomic tailwind becomes less supportive whereas the outcome of Brexit negotiations and their potential impact on customer behaviour that may include a shift to late bookings exacerbates the uncertainty.”
The news comes as Thomas Cook director Lesley Knox and chairman Frank Meysman bought the company’s stock at its new, reduced price.
Knox invested a further £47,000 in the company while Meysman bought £80,000 worth of shares, regulatory filings revealed this morning.