Shares in Primark owner Associated British Foods (LON:ABF) were on the rise today after heavyweight broker Goldman Sachs released a bullish statement on the company.
ABF is thought to be refocusing its business more towards the Primark brand as other areas, in particular the sugar sector, continue to struggle.
It is taking its Primark brand to the states with a September launch of a new store in Boston which Goldman says could be a catalyst for investor interest.
The financial services giant expects the company to add £720mln to its earnings from its US Primark business by 2020.
“US consumers buy almost double the amount of their European counterparts on a volume basis while spending less” the company said.
Goldman said the trend is pronounced mainly in the millennial generation - people born between 1980 and 2000 - which makes up 40% of the US population.
The US broker also notes there is “still plenty of opportunity to expand in Europe” where Primark is becoming a growing brand.
As a result, Goldman upgraded its rating on the stock to a ‘buy’. Shares ABF rose 2.3% to 3,018p today.