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Monday January 26th 2009
The City view - WH Smith
Archived article dated Monday January 26th 2009
Investec Securities has re-iterated its 'Buy' recommendation on WH Smith because of its defensive qualities following the company's Christmas trading update.
The broker states that WH Smith's low average transaction value and strategy of focusing on cost savings and gross margin improvements provides it with good defensive qualities in the current tough climate.
However, Investec suggests WH Smith will be under increased pressure to deliver on these two fronts because of its deteriorating like-for-like sales over the festive period. This worry is tempered somewhat by the strong record that management has in meeting market expectations. The broker has also retained its target price of 420p although it is under review. This compares with an underlying share price of 354.75p.
Tagged as: wh smith | city broker view
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