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Dunelm Group (DNLMY)
OTHER OTC:DNLMY
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Dunelm Group
(OTC:DNLMY)
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Rating:69Neutral
Price Target:
$14.00
▼(-3.78% Downside)
Dunelm Group's overall stock score is driven by strong financial performance and a positive earnings call outlook. The company's profitability and strategic expansion efforts are significant strengths. However, technical indicators suggest weak momentum, and increasing debt levels pose a risk. The attractive dividend yield supports the valuation score.
Positive Factors
Digital Channel Growth
The increase in digital sales indicates a strong online presence, which is crucial for long-term growth in the retail sector. This shift helps Dunelm reach a broader audience and adapt to changing consumer preferences, enhancing revenue stability.
Market Share Expansion
The growth in market share demonstrates Dunelm's competitive positioning and ability to capture a larger portion of the market. This expansion supports sustained revenue growth and strengthens its market leadership.
Strong Financial Performance
The increase in profit and operating cash flow reflects efficient operations and financial health, providing Dunelm with resources to invest in growth initiatives and maintain financial stability.
Negative Factors
Increasing Debt Levels
Rising debt levels can strain Dunelm's financial flexibility, potentially impacting its ability to invest in growth and weather economic downturns, posing a risk to long-term stability.
Challenging Cost Environment
Rising operating costs due to inflation could pressure margins, affecting profitability. Managing these costs is crucial for maintaining competitive pricing and financial health.
Scope 3 Carbon Reduction Challenges
Challenges in reducing Scope 3 emissions may impact Dunelm's sustainability goals and reputation, potentially affecting customer perception and regulatory compliance in the long term.
Dunelm Group (DNLMY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.57B
Dividend Yield6.4%
Average Volume (3M)0.00
Price to Earnings (P/E)12.7
Beta (1Y)0.64
Revenue Growth6.66%
EPS Growth6.21%
CountryUS
Employees12,000
SectorConsumer Cyclical
Sector Strength84
IndustrySpecialty Retail
Share Statistics
EPS (TTM)0.42
Shares Outstanding201,679,430
10 Day Avg. Volume0
30 Day Avg. Volume0
Financial Highlights & Ratios
PEG Ratio5.62
Price to Book (P/B)19.70
Price to Sales (P/S)1.32
P/FCF Ratio10.61
Enterprise Value/Market Cap1.05
Enterprise Value/Revenue1.52
Enterprise Value/Gross Profit2.90
Enterprise Value/Ebitda10.71
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Dunelm Group Business Overview & Revenue Model
Company DescriptionDunelm Group plc is a leading UK home furnishings retailer, specializing in a wide range of products for the home, including bedding, curtains, furniture, and home decor. Established in 1979, the company operates both physical stores and an online platform, offering customers a diverse selection of quality home goods at competitive prices. Dunelm's mission is to help customers create a home they love, providing inspiration and practical solutions across various lifestyle segments.
How the Company Makes MoneyDunelm generates revenue primarily through the sale of home furnishings and accessories, with key revenue streams coming from both in-store sales and e-commerce transactions. The company's extensive product range includes exclusive brands, which allow for higher margins. Seasonal promotions and sales events also contribute to sales volume. Additionally, Dunelm benefits from strategic partnerships with suppliers and manufacturers, ensuring a reliable supply chain while maintaining quality and cost-effectiveness. The company's loyalty program and customer-centric approach help drive repeat business, further enhancing its revenue potential.
Dunelm Group Earnings Call Summary
Earnings Call Date:Sep 09, 2025
(Q4-2025)
| % Change Since: |
Next Earnings Date:Feb 10, 2026
Earnings Call Sentiment Positive
The earnings call reflects a generally positive outlook for Dunelm, with significant growth in sales, market share, and digital channels. Despite some challenges with costs and environmental impact, the company demonstrates strong financial performance and strategic expansion efforts.Q4-2025 Updates
Positive Updates
Sales and Market Share Growth
Sales increased by 3.8% to GBP 1.8 million, with a notable increase in market share to 7.9%, up 20 basis points from the previous year.
Strong Financial Performance
Profit before tax grew by 2.7% to GBP 211 million, and operating cash flow increased by 10% year-on-year.
Digital Channel Growth
Digital sales participation rose by 3 percentage points to make up 40% of total sales, with Click & Collect sales growing by around 30%.
Dividend Increase
An increased total ordinary dividend for the year was announced at 44.5p per share, up 2.3% year-on-year.
Expansion and Acquisitions
First store opened in London and acquisitions made in Ireland. A new in-house production capability for made-to-measure products was established in the Midlands.
Negative Updates
Challenging Cost Environment
Operating costs increased due to inflationary pressures, particularly driven by labor cost inflation and the National Living Wage.
Scope 3 Carbon Reduction Challenges
Progress on Scope 3 carbon reduction has been challenging, with more work needed to measure and reduce both carbon and water consumption across the supply chain.
Lack of Sustained Consumer Recovery
While there was stronger growth in the second half of the year, the company is not yet calling out a consumer recovery.
Company Guidance
The call provided detailed guidance on Dunelm's financial performance and strategic outlook for the fiscal year ending in June 2025. Sales increased by 3.8% to GBP 1.8 million, with a strong gross margin of 52.4%, up 60 basis points year-on-year, and a profit before tax of GBP 211 million, reflecting a 2.7% growth. The company declared a total ordinary dividend of 44.5p per share, alongside a special dividend of 35p, culminating in a total distribution of 79.5p per share. Dunelm's digital sales now constitute 40% of total sales, with Click & Collect sales growing by 30%. The company aims to maintain a stable PBT margin, despite inflationary pressures, by achieving efficiencies and investing in growth initiatives, including the opening of 5 to 10 new superstores and further store refits. Operating cash flow increased by 10%, and the company ended the year with net debt of GBP 102 million, maintaining a net debt-to-EBITDA ratio of 0.3x. Looking ahead, Dunelm anticipates continued strategic progress with a focus on elevating product offerings, enhancing customer experiences across channels, and driving operational efficiencies.Dunelm Group Financial Statement Overview
Summary
Dunelm Group demonstrates strong profitability and efficient operations with consistent revenue growth and healthy margins. However, increasing debt levels and a recent slowdown in free cash flow growth pose potential risks. The company should focus on managing its leverage and improving cash flow growth to maintain financial stability.Income Statement
Dunelm Group has shown consistent revenue growth over the years, with a stable gross profit margin around 52%. The net profit margin has been steady at approximately 8.8%, indicating good profitability. However, the revenue growth rate has slowed down recently, which could be a concern if it continues. The EBIT and EBITDA margins are healthy, reflecting efficient operations.75
Positive
Balance Sheet
The company has a high debt-to-equity ratio, which has increased over the years, indicating higher financial leverage and potential risk. The return on equity is strong, suggesting effective use of equity to generate profits. However, the equity ratio is relatively low, which could be a concern for financial stability.60
Neutral
Cash Flow
Dunelm Group's cash flow metrics are solid, with a high free cash flow to net income ratio, indicating good cash generation relative to profits. The operating cash flow to net income ratio is also strong, suggesting efficient cash management. However, the free cash flow growth has been negative recently, which could impact future liquidity.70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.77B | 1.77B | 1.71B | 1.64B | 1.58B | 1.34B |
| Gross Profit | 928.30M | 928.30M | 883.30M | 820.90M | 809.40M | 688.90M |
| EBITDA | 251.20M | 251.20M | 239.70M | 224.10M | 297.60M | 241.40M |
| Net Income | 156.30M | 156.30M | 151.20M | 151.90M | 171.20M | 128.90M |
Balance Sheet | ||||||
| Total Assets | 741.50M | 741.50M | 682.00M | 696.80M | 737.90M | 766.70M |
| Cash, Cash Equivalents and Short-Term Investments | 30.00M | 30.00M | 23.40M | 46.30M | 30.20M | 128.60M |
| Total Debt | 377.70M | 377.70M | 326.60M | 334.10M | 330.90M | 293.30M |
| Total Liabilities | 622.70M | 622.70M | 544.10M | 559.30M | 559.60M | 485.50M |
| Stockholders Equity | 118.80M | 118.80M | 137.90M | 137.50M | 178.30M | 281.20M |
Cash Flow | ||||||
| Free Cash Flow | 220.70M | 220.70M | 199.90M | 218.80M | 227.80M | 168.50M |
| Operating Cash Flow | 255.90M | 255.90M | 232.30M | 240.60M | 251.80M | 184.20M |
| Investing Cash Flow | -65.90M | -65.90M | -38.30M | -20.70M | -41.60M | -15.60M |
| Financing Cash Flow | -183.00M | -183.00M | -217.30M | -204.40M | -309.70M | -127.60M |
Dunelm Group Technical Analysis
Negative
14.55
Price Trends
14.81
Negative
14.83
Negative
14.91
Negative
Market Momentum
-0.20
Positive
23.83
Positive
34.26
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DNLMY, the sentiment is Negative. The current price of 14.55 is below the 20-day moving average (MA) of 15.03, below the 50-day MA of 14.81, and below the 200-day MA of 14.91, indicating a bearish trend. The MACD of -0.20 indicates Positive momentum. The RSI at 23.83 is Positive, neither overbought nor oversold. The STOCH value of 34.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DNLMY.
Dunelm Group Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $25.25B | 23.25 | 56.92% | 1.37% | 5.10% | 7.59% | |
69 Neutral | $2.57B | 12.72 | 119.92% | 6.40% | 6.66% | 6.21% | |
67 Neutral | $3.91B | 10.71 | 18.34% | 1.04% | -0.65% | -10.35% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
53 Neutral | $4.76B | 7.15 | ― | 4.16% | -1.04% | -20.88% | |
52 Neutral | $4.37B | 41.99 | ― | ― | 9.74% | 55.13% | |
51 Neutral | $303.05M | -1.38 | -67.22% | ― | -8.07% | -2206.16% |
* Consumer Cyclical Sector Average
DNLMY
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14.10%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.