Positive catalyst at Card Factory, says Liberum3 Jun 2020 08:26
Card Factory (CARD) remains a ‘good quality’ business despite the impact of Covid-19 and Liberum is expecting the next update to provide ‘positive catalysts’.
Analyst Adam Tomlinson retained his ‘buy’ recommendation and target price of 100p on the shares, which were trading at 37.3p yesterday.
‘Putting aside the Covid-19 impact on full year 2021, Card Factory remains a good quality, vertically integrated, high margin and cash generative business,’ he said.
‘The current year 2021 price/earnings ratio of just 3.5 times and free cashflow yield of 30.1% does not make much sense to us.’
Tomlinson predicted that the strategy update at the end of July would provide ‘positive catalysts, giving greater clarity on future growth opportunities, including retail partnerships and capital-light channels’.