Woolworths, which suffered last week in the wake of a bearish Citi note, took another hit as Shore Capital added to the gloom. “We see no attraction to the shares ahead of Christmas and struggle to see Woolworths as any form of credible bid target,” it said.
Deutsche Bank was also downbeat. The broker acknowledged Woolworths’ multichannel success, but worried about the core business. “We anticipate Woolworths’ main chain will struggle to generate like-for-like sales growth in the year ahead,” it said. “From a break-even position in 2007/08, we expect losses to widen to£14 million in 2008/09.”
Panmure Gordon remains one of the retailer’s supporters and recommends buy. The broker believes Woolworths’ value credentials should stand it in good stead over Christmas, as long as availability and execution are up to scratch.
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