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Dixons Carphone ringing in first-half figures

These figures will offer investors a clearer idea of how well the merged company has transformed over the last seven months. 

CFDs are a leveraged product and can result in losses that exceed deposits. Trading CFDs may not be suitable for everyone, so please ensure you fully understand the risks and take care to manage your exposure.
Dixons Carphone branch
Source: Bloomberg

The merger of Carphone warehouse and Dixons has created a company that is of particular interest to all mobile phone companies, because of its disproportionate influence in the face-to-face sale and care of mobile phone users. The fact that the new combined company offers the largest and broadest shop window for mobile and smart devices, along with tablets, has given it even greater leverage with its suppliers.

It is still too early to judge how successful the company has managed to position itself, but there was certainly a gap in the market for a firm to offer consumers assistance after they had purchased goods. With the increasing levels of sophistication and functionality in smartphones, a sizeable demographic require tech assistance.

Statements from the company in September pointed towards a boost in TV sales, driven by the football world cup in Brazil. This is likely to have subsided since then.

It will also be interesting to see how the refocusing of the big four food retailers affects the market, as they look to revert some of the cross-selling they have previously done with white goods and focus back onto the food market.

Institutional analysts still remain supportive of the company. Of the 14 rating the firm, ten have them as a buy, three as a hold and only one is a sell. The average price target is 450p, and the current share price is still some 4.5% off that level.

Since January 2013 the trend for the shares has been broadly bullish however, the move in the last couple of months does look a little like it has gotten ahead of itself, and a closer alignment with the 200-day moving average would offer a more attractive entry level for those looking to go long.

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CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

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