B&M European Value Retail SA (LON:BME) is a ‘buy’ again for Liberum, which resumed its recommendation from ‘under review’ following strong sales during lockdown.
The broker set the target price at 425p as the discount retailer “has been well-placed to benefit from consumer behaviour during the COVID-19 outbreak”.
READ: B&M sales boom as lockdown boosts gardening and DIY
“Financial year 2021 has started very strongly and will have boosted an already comfortable liquidity position, which we now see as troughing in excess of £350m in financial year 2021,” analysts said.
However, the broker noted that it is uncertain how trade patterns will settle, while there will be additional operating costs relating to safety measures.
The FTSE 250-listed firm kept operating some stores during the lockdown, with like-for-like revenues jumping 22% in the eight weeks to 23 May thanks to high demand for gardening and DIY products.
Shares rose 2% to 398.2p on Monday morning.