Oriel Securities hints at forecast upgrades for Home Retail

12th Jun 2014 15:51

Oriel Securities hinted that it may upgrade forecasts for Home Retail after the Argos and Homebase owner reported a good start to the year.Oriel said it was not changing its forecasts "but the pressure is to the upside" after Home Retail said strong sales of seasonal products in better weather helped Argos and Homebase to lift like-for-like sales in the 13 weeks to May 31st.Argos increased like-for-likes (LFL) by 4.9% to £868m and Homebase sales rose 7.9% to £445m.Oriel, which is advising investors to keep the stock, said Homebase sales matched hopes, but expectations for Argos had gathered around the 4% mark so 4.9% was "a pleasant surprise"."We could ease Argos numbers up by £5m but we will leave things where they are and consider numbers to be firmly underpinned," the broker said.It added: "Comparatives get much tougher here but we do think Homebase's positioning in the market will ensure LFL does not collapse. So no change to group forecasts but the pressure is to the upside."Shares fell 7.8p or 3.9% to 192.8p by 15:58 in London.PW