Retail still has value, say experts

ALL investors’ eyes have been on the supermarkets ever since panicbuying replaced leisurely browsing. But stock-pickers believe there’s now investment value among some of the non-essential retailers.

Jean Roche, small and mid-cap fund manager at Schroders, believes pessimism in this area has been ‘ overdone’. She adds: ‘ We think avoiding it is a missed opportunity.’

Roche says retailers will have to be smarter to compete with firms such as Amazon and that the companies that thrive will be those which were already making structural shifts before the pandemic hit. She recommends homeware business Dunelm and Pets at Home as two strong choices.

Roche explains: ‘Pets at Home has benefited from being classified as an essential retailer, but has also invested wisely in its online presence as well as stores. It will report profits ahead of market expectations this year.’

Georgina Brittain is manager of investment trust JP Morgan Mid Cap and unit trust JP Morgan UK

Smaller Companies. She also holds Dunelm in her funds. She says: ‘We are confident Dunelm has the potential to emerge stronger.’

Nick Train, of investment house Lindsell Train, suggests investors should hold shares in Burberry. He says: ‘The young are going to party through the 21st Century’s “roaring 20s”. Burberry will clothe many of them, particularly in Asia.’ Burberry is a top ten holding in investment trust Finsbury Growth & Income and fund Lindsell Train UK Equity, both managed by Train.