EU and US could reach trade deal this weekend - Reuters
On Tuesday, Deutsche Bank (ETR:DBKGn)’s analysts, led by Adam Cochrane, revised the price target for B&M European Value Retail SA (LON:BMEB) (BME:LN) (OTC:BMRRY) shares, lowering it to £4.10 from the previous £4.35. Despite this adjustment, the firm maintained its Buy rating on the stock.
The price target revision comes after B&M’s fiscal year 2025 (FY25) update, which resulted in the company’s shares falling by 15% over the past week. This decline occurred even though B&M had already provided a post-year-end trading update. Cochrane noted that while the company continues to expand its retail space, a sustainable like-for-like (LFL) sales recovery is necessary to address concerns over operational deleverage within the existing store network.
The analyst anticipates a positive shift in LFL sales in the first quarter, projecting an increase of about 3%, driven by seasonal general merchandise. Cochrane’s outlook remains optimistic, citing the stock’s attractive valuation, which trades at approximately 8 times the calendar year 2026 price-to-earnings (PE) ratio and offers a free cash flow (FCF) yield of around 13 times.
Despite the positive aspects of B&M’s investment case, investor sentiment remains cautious due to the potential for a new CEO to reset the company’s financial baseline. This concern has tempered investor enthusiasm, as indicated by the recent share price movement. Nonetheless, Deutsche Bank’s reiteration of the Buy rating suggests confidence in the stock’s future performance, albeit with a more conservative price target reflecting the revised earnings per share (EPS) forecasts for FY26.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.