On the back of JD Wetherspoon’s full-year update on Friday, leading analyst Geof Collyer at Deutsche Bank has suggested that the group’s net openings figure for its current year could be zero “implying that FY16 could be only the second year since IPO that the pub estate has been flat yr-on-yr”.

Collyer also said over the past decade, JDW has added £666m of sales on the back of ~£770m of development capex, generating just £52m of incremental EBITDA – an implied return of less than 7%.

He said: “During this period, the cash return on average capital invested has dropped 210 bps to 9.6%, so either the new investments are not delivering or the underlying business is going backwards alarmingly.”

The company said that its rollout had been scaled back to 15-20. Collyer said: “But with c20 pubs up for sale, the net figure could be zero, implying that FY16 could be only the second year since IPO that the pub estate has been flat yr-on-yr. The already signalled 8% increase in starter pay in August should make any impact from the National Living Wage this year de minimis. Guidance is for broadly flat profits in FY16, which is in line with consensus.

“The stock has fallen 8% since the July profit warning (flat vs. FTSE 100), when we downgraded by 11%. There is a probable share price floor close to this level, given JDW’s opportunistic buyback strategy, but few upside attractions.

“We prefer Greene King (Buy; GNK.L 840p), where growth is underwritten by the Spirit deal, or Restaurant Group (Buy; RTN.L 669p), where we compared JDW and RTN’s roll out strategies over the past decade, where RTN has delivered a much better performance, aided by sustained margins).”