MIDAS VERDICT:
Dunelm’s success illustrates the power of going digital at just the right time. The company has capitalised on our renewed love affair with our homes in the pandemic and will continue to do so as we settle into new properties bought as a result of the stamp duty holiday. There may be some bumps ahead – not least because of supply chain problems and inflation – but the business has plenty of growth potential as it moves further into the furniture business, offering highvalue items like sofas as well as smaller items.
Upgraded forecasts put the shares on 18 times forward earnings with a yield of three per cent. Given the strong indications in the full-year figures, they are a buy.