Broker Oriel initiated coverage of Carphone Warehouse with a buy note on the back of consumer adoption of smartphones and the potential of its constituent operations.
Oriel said: “While the Carphone Warehouse business is relatively mature from a market share perspective, the shift to smartphones and the growing demand for larger data packages works in its favour.
The broker expects revenues per customer will grow as this new technology is adopted more universally.
Oriel is pleased by how the mobile phone venture with Best Buy in the US has progressed and sees potential for the fledgling Best Buy big-box UK chain. While the UK sheds may not appeal to the entire market, their focus could impress the target customer.
Oriel sees fair value of 285p per share for Carphone, which last week reported first quarter like-for-like growth of 3.7%.