Berenberg hikes target price on Currys

(Sharecast News) - Analysts at Berenberg raise their target price on electronics retailer Currys from 175p to 200p on Tuesday, citing a broad-based recovery across the group and what it called the most positive outlook in a decade. Berenberg said growth was "firmly back on the agenda", with sustained revenue gains in both the UK & Ireland and the Nordics for the first time in four years. It also highlighted a £5bn-plus opportunity in under-indexed and adjacent categories, including B2B.

The German bank stated confidence in the Nordics recovery was building, with underlying earnings already tripling from FY23 lows through self-help measures. It said a return to pre-Covid EBIT margins of around 3% could add £30m to divisional forecasts, with further upside if Currys regains its FY20-22 average of 3.5%.

Currys' services business was flagged as a key differentiator, driving recurring, higher-margin revenue. Credit, repair and mobile connectivity revenues rose 9% in FY25 to £814m, embedding Currys deeper into the supply chain and boosting customer retention.

Free cash flow was said to be on a "significantly improving trajectory", with post-pension FCF expected to ramp to around £130m by FY27. Berenberg said this had already supported the reinstatement of dividends and a £50m buyback, with more to come.

Berenberg added that its sum-of-the-parts valuation suggested investors were getting the UK electricals division "for free", with the combined value of Nordics and iD Mobile estimated at £1.6bn - equal to the current market cap.





Reporting by Iain Gilbert at Sharecast.com