RBC Capital downgrades Halfords, shares slump
Halfords Group
204.20p
09:44 22/09/23
Halfords was under the cosh on Friday after RBC Capital Markets downgraded the shares to ‘sector perform’ from ‘outperform’ and cut the price target to 220p from 230p.
FTSE All-Share
4,180.05
09:50 22/09/23
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09:50 22/09/23
General Retailers
3,561.16
09:49 22/09/23
"We think that Halfords remains a strong player in a space that has seen a number of challenges across the last few years," RBC said.
"We believe that near-term, it should benefit from market recovery and digital/data driven gains, but we believe execution risks remain."
RBC said the valuation now looks fair after a recent re-rating in the shares, hence the downgrade.
"We have also lowered our FY24-25e earnings per share forecasts by circa 3% given slightly lower margin expectations due to softer cycling sales and labour cost pressures."
At 0855 BST, the shares were down 4.5% at 193p.