Dixons Carphone: Liberum puts rating under review.
(CercleFinance.com) - Liberum has placed its "buy" rating and its target price of 430 pence on Dixons Carphone "under review," saying that the retailer's profit warning suggests estimate cuts of up to 20%.
The brokerage firm said that today's warning - that the British company attributed to mobile weakness - means a new 2017/2018 profit before tax guidance of 360 million pounds to 440 million pounds, compared to the current consensus of almost 500 million pounds.
"There has been weakness in the UK post-pay mobile market, where Dixons Carphone has invested in margin to maintain share, delivering broadly flat volumes on last year," Liberum explains.
The broker notes that handset demand has been lower, with consumers holding on to their current devices for longer due to the pound's depreciation and a slower rate of innovation.
Liberum adds that key unknown factors include how successful the iPhone 8 will be and trading performance over the forthcoming Christmas peak period.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
The brokerage firm said that today's warning - that the British company attributed to mobile weakness - means a new 2017/2018 profit before tax guidance of 360 million pounds to 440 million pounds, compared to the current consensus of almost 500 million pounds.
"There has been weakness in the UK post-pay mobile market, where Dixons Carphone has invested in margin to maintain share, delivering broadly flat volumes on last year," Liberum explains.
The broker notes that handset demand has been lower, with consumers holding on to their current devices for longer due to the pound's depreciation and a slower rate of innovation.
Liberum adds that key unknown factors include how successful the iPhone 8 will be and trading performance over the forthcoming Christmas peak period.
Copyright (c) 2017 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.