‘There is a lot to like’. That is the conclusion of Liberum after it initiated coverage of Moonpig Group PLC (LSE:MOON) with a ‘buy’ recommendation and 145p a share price target.
In the plus column were the facts it has around 70% of the online greeting cards market, a 25% EBITDA margin and is throwing off £50mln of free cash per year.
“But we question if it gets any better from here, with some clear risks,” the broker added in a note to clients.
While positive on the stock, Liberum said it would “advise loading up on Card Factory (LSE:CARD), where we see ongoing recovery and growth offering much greater upside for the UK’s market leader”.
Moonpig’s shares, up 12% in the year to date, were trading sideways at 127p each.