Brokers have been turning more positive on Primark clothing stores to Silver Spoon sugar conglomerate Associated British Foods plc (LON:ABF) following yesterday’s upbeat trading statement from the FTSE 100-listed firm.
Among them, Deutsche Bank has raised its price target for AB Foods to 3,300p, up from 3,200p previously, and repeated a ‘buy’ rating on the stock.
READ: AB Foods shares jump as underlying trading ahead of forecasts thanks to strong performance from Primark
In a note to clients, the German bank’s analysts said: “Primark UK performance confirms it is outperforming its largest peers. AB Foods reported healthy sales growth in the 16 weeks to 24 June.”
They added: “As Kantar Worldpanel data shows, the largest mid-market retailers are losing market share while Primark is gaining.
“We expect Primark to continue to benefit from a consumer shift to value driven by pressure on spending power.”
The analysts said they have also increased their forecasts for AB Foods by around 1-2% .
Meanwhile, French broker Kepler Cheuvreux has reportedly upgraded its rating for AB Foods to buy from hold with an increased target price of 3,300p, up from 2900p previously after raising their earnings per shares forecasts by 6% on average.
However, after strong gains yesterday, AB Foods shares drifted lower in mid morning trade, down 0.5%, or 14p at 2,983p.