The newly merged Dixons Carphone is in demand as analysts reacted positively to Wednesday's strategy day.
The company said it could reach its £80m cost savings target earlier than expected, and while not raising the amount it said it was "firmly a minimum."
In the wake of the meeting Bank of America Merrill Lynch issued a buy note and raised its target price from 400p to 420p. Investec also issued a buy note, with analyst Alistair Davies saying:
Presentations on the core UK business highlighted the resilience of both Dixons and Carphone Warehouse and management's upbeat outlook for Connected World Services (CWS) could offer long-term upside. The shares trade on a 2015 estimated PE of 15 times, with scope for upgrades as synergy numbers increase and the timeframe in which they are achieved shortens.
Analyst Nick Bubb gave some details of the meeting:
[The] strategy day in Oxford didn't do much for the Dixons Carphone share price [on Wednesday], but it was pretty confident in tone and although the company had warned, in deathless prose, that "no update on current trading will be provided during the presentation" the ebullient chief executive Seb James said quite openly that trading is going well, after a good "Back to Skool" period and strong sales of the Apple iPhone 6.
And though management decided not to increase their synergy targets at this stage, £80m is clearly the bare minimum now envisaged, thanks to early action on headquarter costs (with Hemel Hempstead to be axed next year in favour of Acton) and the marked success of the new Carphone Warehouse store-within-a-stores.
And James was able to make very reassuring noises about Carphone's network relationships, having just signed an MVNO [mobile virtual network operator] agreement to get 3 back into the business. And having tied in with Apple to provide the technology to connect the handsets bought by consumers in Apple stores in the UK, management were notably more confident about the outlook for the new Connected World Services business (so much so that its results will be broken out for the first time in the interims in December).
Dixons Carphone is currently up 7.4p or 2% at 373.5p.
