Berenberg initiates coverage on Currys at 'hold'

Analysts at Berenberg initiated coverage on electrical retailer Currys, formerly Dixons Carphone, with a 'hold' rating and 70.0p target price on Thursday, stating it was waiting for a "milder backdrop".

Berenberg said that with "a credible strategy" to rebuild the profitability of its UK and Ireland business, an "underappreciated" Nordic presence, and a "sustainably stronger" balance sheet, there were several reasons to believe that there is upside to Currys' share price on a medium to long-term view.

However, given the group's exposure to the "increasingly difficult macroeconomic backdrop", the analysts remain cautious about the demand outlook for the sector and also noted that the group posted a double-digit like-for-like decline in key categories during the GFC in 2009.

"Our FY 2023 adjusted PBT forecast lies 7% below consensus. On our estimates, Currys trades on 9.3x CY 2023 EV/EBIT and 6.3x P/E," said the German bank.

Reporting by Iain Gilbert at Sharecast.com