After Supreme PLC (LON:SUP) reported its maiden full-year results since listing, broker Berenberg was bullish about prospects for the company.
Analysts, who upped their price target on the shares to 240p and reiterated their 'buy' recommendation, were encouraged by the solid momentum across the company's three most significant growth avenues in recent months, namely vaping, sports nutrition & wellness, and bolt-on acquisitions.
While Supreme's own vaping brand, 88vape, is the market leader in the UK by volume, most sales to date have been via independent and discount retailers, so they were "highly encouraged" by the announcement that 400 Sainsbury's stores will stock the brand by the end of the summer.
"With only circa 7% of the UK adult population currently using e-cigarettes, while c14% still smoke, we think 88vape remains well positioned to continue growing strongly in the years ahead."
After the launch of a digital-only vitamins brand Sealions, accompanied by a TV and radio marketing campaign, this week, ahead of the launch of Supreme's retail vitamins brand Millions & Millions due in September, boasting Davina McCall as a brand ambassador, the analysts say that being up to 70% cheaper than existing brands, "Supreme could build a sizeable business in the vitamins category, which could drive upside to our estimates".
Two bolt-ons completed since February's IPO were also highlighted for potential 'synergies' that could be extracted: Irish batteries and lighting business Vendek and sports nutrition brand SCI-MX Nutrition.