Broker Liberum estimates Naked Wines PLC (AIM:WINE, OTCQX:NWINF) can generate £10mln of free cash flow annually on a sustainable basis.
This was one of the key takeaways from a research note written in the wake of the company’s trading statement.
The broker said Naked Wines' full-year 2023 (FY23) numbers would be upgraded following the update “due to a stronger margin outturn from repeat customers and costs cutting ahead of expectations”.
“However, volumes are under pressure and the opportunity to acquire new customers is tough hence we downgrade FY24 modestly,” it added.
Liberum broker repeated its ‘hold’ recommendation on the stock in the online wine retailer, valuing it at 130p.