BNPP Exane upgrades Currys, says iD Mobile is underappreciated
BNP Paribas Exane upgraded Currys plc on Thursday to 'outperform' from 'neutral' and lifted the target price to 135p from 115p as it said the iD Mobile business is an underappreciated driver of the company's growth, "enhancing sales, margins, and underpinning valuation".
It noted that iD Mobile is worth nearly one-third of Currys' market capitalisation. "Its leading price proposition can continue to attract subscribers, driving sales and expanding gross margins," it said.
Other drivers include a tech replacement cycle, new product categories, margin-accretive services, and B2B investments, BNP said.
"With a stronger balance sheet, share buybacks are on the horizon."
BNP said gross margin expansion should come from the sale of mobile services in the UK & Ireland and a focus on profitable sales and services in the Nordics.
The bank said it expects this to enable Currys to achieve its target of "at least" 3% adjusted EBIT margins by FY Apr-29E.
At 1300 BST, the shares were up 0.5% at 112.30p.
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