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DEBS: Margin Gains And AI-Driven Agility Will Face Slower Sales Ahead

Digital-first Model Will Yield Cost Savings And Streamlined Operations

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DEBS
AnalystConsensusTarget
Not Invested
Published 28 Mar 2025

Update shared on 01 Dec 2025

Fair value Increased 11%
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AnalystConsensusTarget's Fair Value
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1Y
-38.2%
7D
-15.9%

Analysts have raised their price target for boohoo group from £0.22 to £0.25, citing an improved profit margin outlook and a lower discount rate, although they have tempered expectations for revenue growth.

What's in the News

  • Debenhams Group, part of boohoo group, has launched a new artificial intelligence solution to manage sales, stock, and pricing more effectively across its brands (Key Developments).
  • The AI tool provides teams with clearer insights into demand and performance. This enables faster and more accurate decision-making during the busy Golden Quarter period (Key Developments).
  • This innovation is expected to improve efficiency and agility by allowing teams to respond more quickly to changing shopping patterns ahead of Black Friday and the festive season (Key Developments).
  • The AI solution was developed in partnership with Peak, a UiPath company. This follows an initial collaboration that began in June to enhance product pricing and promotion strategies (Key Developments).

Valuation Changes

  • Fair Value: Increased from £0.22 to £0.25. This reflects a moderate upward revision in the target price.
  • Discount Rate: Decreased from 12.20% to 10.84%, which indicates a lower perceived risk or improved market conditions.
  • Revenue Growth: Reduced from 2.1% to -1.1%. This shows a decline in projected sales performance.
  • Net Profit Margin: Rose slightly from 2.99% to 3.07%. This points to expectations of greater efficiency or profitability.
  • Future P/E Ratio: Decreased from 19.78x to 18.56x, suggesting an improved earnings outlook relative to the share price.

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