Canaccord Genuity has cut its investment rating on homeware retailer Dunelm (LON:DNLM) to ‘hold’ from ‘buy’, stating that management’s plans for longer-term gains are likely to cause short-term pain.
The broker said: “Dunelm remains a quality company with very strong cash generation. Our forecasts still deliver earnings growth against a more uncertain consumer backdrop, albeit at a reduced rate, while its targeted investment programme acts as a drag on operating margin over our forecast horizon.”
Nevertheless, analysts have increased their price target to 920 pence per share from 875 pence.
Separately, Numis remained at ‘add’, while Deutsche Bank and Jefferies repeated their respective ‘hold’ calls on the stock.
At 1:25pm: (LON:DNLM) Dunelm Group PLC share price was +3.75p at 896.25p
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