Dunelm should deliver 'solid' festive performance, Deutsche Bank predicts

Deutsche upped its share price target for Dunelm to 685p from 640p, with its recommendation remaining 'hold' following a challenging 12 months but where like-for-like sales and space expansion have recently accelerated and the integration of acquired online business WorldStores appears to be performing on track.

Looking forward to the homewares retailer's post-festive update in January, analysts forecast a solid performance due to modest comparatives and from faster online growth due to the added WorldStores ranges.

LFL sales are predicted to be up 2% and total sales 12.9%, including £15m perimeter effect of consolidating the final two months of WorldStores.

With slightly more optimistic second and third quarter sales assumptions, analysts increased forecasts 3%, implying Dunelm trades on 13 calender 2018 P/E ratio with a 7% free cash flow yield.

DB retiatered 'buy' ratings for Associated British Foods, B&M European Value and Boohoo as its top picks in the non-food retail sector.