Dunelm’s investors should “revisit its investment case” according to Deutsche Bank ahead of the homeware retailer’s fourth-quarter update next month.
Deutsche Bank remained a buy on the stock, with a target price of 1,313p.
While the share price has fallen by low-single digits since April, data points have improved, the German bank said.
The broker said it remains positive due to strong data from its own survey and improving Google trends, a strengthening pound to the dollar and falling material and freight prices.
Shares are currently down 2.4% to 1,090p, although up 10% in the year so far.