RE: Panmure upgrade to buy and 150p target30 Mar 2025 14:34
Panmure Liberum has upgraded Naked Wines (WINE) on the back of a ‘sound’ new strategy.
Analyst Wayne Brown moved his recommendation from ‘hold’ to ‘buy’ and increased his target price from 50p to 150p on the online retailer.
‘Investors need to pay attention – Naked Wines has turned a corner,’ he said.
Brown noted that it is now free cashflow positive and the company has a plan to achieve three things: significantly build cash on the balance sheet to more than £100m over the next five years; return the business to 5-10% revenue growth while underpinning earnings at £10m in the near-term; and commit to distributing this cash to shareholders.
‘All this is being achieved while improving returns, and deploying a new marketing plan that offers the opportunity to deliver sustainable growth,’ said Brown.
‘With cash much greater than the current market cap of £45m we see huge upside to the share price.’
The shares were trading up 28% at 80.5p on Thursday afternoon, and have risen 40% over one year.