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Here’s Why B&M Share Price Gapped 9% Higher Today

Nigel Firth
Nigel Frith trader
Updated 28 Jul 2020

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B&M European Value Retail (LON: BME) share price gapped 9% higher this morning after the retailer raised earnings forecasts. 

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The convenience retailer forecasts EBITDA to come in the region between £250 million – £270 million for the six months ending September 26, 2020. This is comfortably higher compared to the market forecast of £208 million.

“Today’s trading update highlights the potential pull forward on first-half earnings and whilst there is earnings upgrade pressure on FY2021 forecasts given the H1 performance,” analysts at Shore Capital commented.

The upgraded forecast is a result of positive performance in the quarter ending June 27 as revenue rose 8% to £1.1 billion. The retailer saw a surge in demand for gardening and DIY products and tools as people were confined to their homes. 

Earlier this month, B&M announced revenue of £1.15 billion for the March 29 to June 27 quarter. This is nearly 28% higher compared to the same period a year ago. 

“The group has made a strong start to the financial year, with a particularly strong performance in our UK businesses, and progress now resumed in France after an eight-week closure period,” B&M chief executive Simon Arora said at the time.

B&M share price gained 9% on raised profit forecast July 2020

Today’s high of 485 marks the new all-time high for B&M share price. Shares have rotated lower in the meantime on profit-taking to trade at 451p, around 2% in the green. 

Nigel Firth
Nigel has been in the regulated financial services industry for nearly a decade, has previously owned a financial brokerage and has written many times for sites relating to personal finance and trading.