Broker snap: Panmure hikes target for Ted Baker after strong Q1

20th Jun 2013 09:45

Panmure Gordon has raised its target price for Ted Baker from 1,411p to 1,571p after the British fashion group's better-than-expected first quarter, but has kept its 'hold' rating on the stock.The broker said that trading for the first 20 weeks of Ted Baker's fiscal year (to June 15th) was "significantly better than we had forecast".Panmure said: "Retail sales grew by 30.7%, more than double our estimate of c.15% on average space growth of 13.4% versus our estimate of c.11%. Wholesale revenue growth of 41% compared with our forecast of c.10% and the company has raised FY2014E guidance for this business division to low double digit revenue growth from a current consensus of high single digits."As a result of Thursday's trading update, the broker expects consensus-forecast upgrades for the full year (ending January 26th 2014) of around 4-5%, although much remains dependent on the key trading period in the second half.Panmure itself has raised its full-year pre-tax profit forecast by 4.7% to £38.4m, representing growth of 21.9% year-on-year.As for the valuation - trading at 21.9 times prospective earnings - the broker thinks that the stock "looks fully valued relative to UK peers Next and SuperGroup, for example, both rated 'buy'".The stock had jumped by 12.22% to 1,649.64p by 10:10 on Thursday.