Analysts reinstated the recommendation at ‘buy’ with a 100p target price, as opportunities remain despite COVID-19 disruption.
The shares have rallied very quickly recently, with potential to benefit from further clarity once shops reopen next month.
Alongside the greeting cards retailer’s history of strong cash generation, the reopenings should help to conclude talks with its banks to secure additional funding, Liberum said.
The broker said lenders should be supportive because they have already waived covenant tests during the lockdowns to date, trading in stores was strong when they were open and the group has a track record of strong cash generation, which should return under more ‘normal’ trading conditions.
Analysts expect group sales to decline 37% to £284mln, with store sales down 38% and e-commerce rocketing 137%.
Loss before tax is expected to come in at £10mln, in line with January guidance, and net debt of £120mln which is lower than last year.
Sales will finally reach pre-pandemic levels in 2024, the broker reckons, which should mean profits will start edging towards 2019 figures as well.
Shares added 2% to 68.48p on Tuesday before close.