Canaccord initiates coverage on 10 multi- channel retailers

Canaccord’s preferred large-cap pick is Pets at Home, which it started at ‘buy’ with a 350p price target. It said recent infrastructure investment provides the building blocks for outperformance of a growing UK pet care market.

Its preferred mid-cap pick is Card Factory, rated ‘buy’ with a 185p price target, which it said offers a multi-channel growth opportunity in the UK and internationally as the business focuses on the large non-card, gifting and celebration market.

In small caps, Canaccord’s preferred picks are ‘buy’ rated Angling Direct and ProCook, for which it has price targets of 57p and 48p.

It said Anglo Direct offers strong growth potential in the UK and Europe as it takes advantage of increasing financial distress amongst independent operators. Meanwhile, ProCook looks set for a strong recovery over the next 12-24 months and is back on the front foot in terms of store expansion, it said.

Canaccord has a price target of 57p on Angling Direct and 48p on ProCook.

Canaccord started B&M European Value Retail at ‘buy’ with a 600p price target. It said it sees significant long-term store expansion potential in the UK and France combined with LFL growth and scope for further special dividends.

It also started Dunelm at ‘buy’, with a 1,250p price target, as it said further store and digital platform expansion is coupled with the prospect for further special dividends.

WH Smith was initiated at ‘buy’, with a 1,469p price target. Canaccord said it sees significant further growth potential for the travel division across the globe.

Wickes also got a ‘buy’ rating, with a 180p price target. Canaccord pointed to scope for further store expansion and organic initiatives including the development of the TradePro membership scheme.

Finally, it started both Halfords and Topps Tiles with ‘hold’ recommendations and price targets of 146p and 42p, respectively.

"Both have ambitious growth plans but we want to see further evidence that earnings have stabilised before taking a more positive stance," it said.