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Broker tips: Moonpig, Tritax EuroBox
(Sharecast News) - Analysts at Canaccord Genuity lowered their target price on greetings cards business Moonpig from 232.0p to 205.0p on Tuesday but said the group had "proven its resilience" despite recent macro concerns. Canaccord Genuity noted that Moonpig's recent interim results last week came with a downgrade to revenue due to macro concerns and some impact from Royal Mail postal strikes - leading to an "unjustified" selloff in the shares.
The Canadian bank stated that despite the downgrade to revenue, underlying earnings guidance has been maintained, highlighting the "resilience" of the business model, despite the aforementioned macro challenges.
Canaccord also highlighted that sales retention had increased to 90%, which should theoretically provide valuation support, and additionally pointed out that the Moonpig business model was "asset-light".
"Therefore, despite short-term headwinds, we believe the share price drop offer[s] investors a chance to pick up a quality growth compounder for a very low valuation," said Canaccord.
"While the short-term macro environment is uncertain, we believe this is more than priced into the current valuation. Using a reverse DCF, the current share price is implying no future EBITDA growth despite the significant structural growth tailwinds from channel shift and Moonpig continually taking market share."
Analysts at Berenberg lowered their target price on property company Tritax EuroBox from 100.0p to 80.0p on Tuesday following the group's full-year results.
Berenberg stated that although Tritax EuroBox's full-year earnings per share fell short of forecasts, it still believes the company's performance was "resilient", with like-for-like metrics up "significantly".
"Like-for-like valuation growth of 5.6% was positive given the current investment market backdrop and led to EPRA NTA per share of 138c, 8.3% ahead of our 127c forecast," added the German Bank.
Berenberg also noted that with the company likely to benefit from rent indexation, but current market conditions delaying further investment, it had opted to reduce its price target on the stock but also maintain its 'buy' rating.
"Shares trade at a CY 2023 P/NTA of 0.56x, 44% below our trough NTA forecasts," added the analysts.
Reporting by Iain Gilbert at Sharecast.com
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