4imprint Group PLC (LON:FOUR) was upgraded to ‘add’ from ‘hold’ by house broker Peel Hunt as “the fall in the share price opens a value gap”.
The promotional merchandise group is not committed to issuing an update at the end of the third quarter, however analysts said market commentary from elsewhere speaks of stabilised, but not materially improving, conditions, which are “encouraging” considering the pandemic.
The company has historically outperformed wider market recovery, Peel Hunt noted.
The price target remained unchanged at 2,200p and so were the forecasts: the broker expects revenue to recover to around 85% of 2019 levels this year, reaching 104% of 2019 levels next year.
Recovery in revenue should be matched by a recovery in gross margin, analysts said, while the big moving part will be the scale to which the company presses the accelerator on marketing to gain market share.
Shares advanced 3% to 1,792p on Monday late morning.