Proactive Investors - Currys PLC (LSE:LON:CURY) has seen a resurgence in recent months led by the analysts at Panmure Liberum who are super bulls of the electronics retailer and regularly reiterate their optimism.
Earlier this month, the broker wrote that the c.35% discount to others in the sector is overdone.
“Over the past five years, the group has transformed the balance sheet and we have seen a c.£870m transfer towards equity value (equal to the current market cap).
“While this has not fully shown through in the market cap, due in part to the issues in the Nordics, there are now clear signs of positive catalysts.
“Margins can double from here and due to the sensitivity of the model (20% drop through), Currys probably offers more Alpha than most.”
Panmure repeated the sentiments before a trading update next Thursday (5 Sep) alongside the AGM.
“Macro conditions are stable, and we are entering into a tech replacement cycle with new technology coming to the fore,” said the broker.
US peer Best Buy Co Inc (NYSE:BBY) mentioned this in its latest update, Panmure noted, with “green shoots appearing in the tablets and computing categories”.
“Sentiment is improving, and proof points are starting to appear,” added the broker, which has a 135p target price.
Forecasts for the year to end April 2025 are sales of £8.37 billion and underlying profits [EBITDA] of £506 million.