Dunelm Group (DNLM) AI Stock Analysis

• Market Cap: £2.32B
• Dividend Yield: 1.77%
• Average Volume (3M): 315.92K
• Price to Earnings (P/E): 15.3
• Beta (1Y): 1.15
• Revenue Growth: 3.07%
• EPS Growth: 1.42%
• Country: UK
• Employees: 12,000
• Sector: Consumer Cyclical
• Sector Strength: 56
• Industry: Specialty Retail
• EPS (TTM): 0.45
• Shares Outstanding: 201,217,440
• 10 Day Avg. Volume: 361,945
• 30 Day Avg. Volume: 315,923
• PEG Ratio: 9.66
• Price to Book (P/B): 14.31
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 9.72
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: £1,256.00
• Price Target Upside: 8.00% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 76 Outperform
• Price Target: ―

Dunelm Group demonstrates strong financial performance and attractive valuation metrics, bolstered by strategic corporate actions and high dividend yield. However, high leverage and overbought technical indicators present potential risks. The company's strategic initiatives and shareholder-focused actions contribute positively to its stock outlook.

Positive Factors

Revenue Growth

Dunelm reported a marked improvement in Q3, with top-line growth accelerating to +6.3%.

Store Expansion

Dunelm announced the opening of its 200th store, a c.+10% increase in its estate versus FY23.

Negative Factors

Market Share Concerns

Concerns around weaker home-related spend and slowing market share gains remain.

Profit Expectations

Despite the improvement in trading, there was no FY PBT upgrade.

Dunelm Group Business Overview & Revenue Model

Company Description

Dunelm Group plc retails homewares in the United Kingdom. The company offers furniture for bedroom, living room, dining room, and office; sofas and chairs; bean bags; bed frames, mattresses, storage beds, divan bases, and headboards, as well as kids beds; and bedding products, such as bed linens, duvets, pillows, mattress toppers, protectors, and baby and kids beddings. It also provides curtains, and poles and tracks; blinds; rugs, runners, and door mats; mirrors, pictures and frames, clocks, wallpapers and DIY, cushions and throws, and accessories; lighting products, including ceiling and wall lights, lamp shades, floor and table lamps, and outdoor lights; kitchen products, such as cooking, dining, utility, and electrical products; and storage products for home, clothes, and kitchen, as well as travel and luggage products. In addition, the company offers garden furniture and storage, garden decoration, and entertaining and dining products; and towels and bathmats, bathroom furniture, bathroom décor, and bathroom accessories, as well as trees and decoration, gifts, cook and dine, and trends Christmas products. It operates 175 superstores and 1 distribution centers, as well as sells its products through an online store at dunelm.com. Dunelm Group plc was founded in 1979 and is headquartered in Syston, the United Kingdom.

How the Company Makes Money

Dunelm Group generates revenue primarily through the sale of home furnishings and related products both in-store and online. Its revenue model is centered around retail sales, driven by a broad product range and competitive pricing. Key revenue streams include the sale of textiles, furniture, and seasonal home accessories. The company enhances its earnings by leveraging a multi-channel strategy, which integrates physical stores with an e-commerce platform, allowing it to reach a wider customer base. Dunelm also benefits from supply chain efficiencies and sourcing strategies that help maintain its competitive pricing. Strategic partnerships with suppliers and exclusive product lines further bolster its market position and contribute to its revenue.

Dunelm Group Financial Statement Overview

Summary

Dunelm Group demonstrates strong revenue growth and operational efficiency, with a gross profit margin of 51.8%. However, a high debt-to-equity ratio of 2.37 poses financial risks, despite strong returns on equity. Cash flow is solid, but there is pressure on free cash flow generation.

Income Statement

Dunelm Group has shown impressive revenue growth, with a steady increase from 2020 to 2024. The gross profit margin stands at 51.8% for the latest period, indicating strong profitability in its operations. Net profit margin has slightly decreased to 8.9% in 2024 from 9.3% in the previous year, showing some pressure on net income growth. However, EBIT and EBITDA margins remain robust at 12.5% and 17.3% respectively, showcasing operational efficiency.

Balance Sheet

The company's balance sheet displays a high debt-to-equity ratio of 2.37 in 2024, indicating significant leverage. This level of debt may pose a risk in economic downturns. The equity ratio is relatively low at 20.2%, suggesting a reliance on debt financing. Return on Equity (ROE) has decreased to 109.6%, reflecting high leverage but also strong utilization of equity to generate returns.

Cash Flow

Dunelm Group has maintained a healthy operating cash flow to net income ratio of 1.54, demonstrating strong cash generation relative to net income. However, free cash flow growth has been negative in the latest period compared to the prior year, indicating potential challenges in generating free cash flow.

Breakdown	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	1.71B	1.64B	1.58B	1.34B	1.06B
Gross Profit	883.30M	741.80M	730.30M	611.40M	454.10M
EBITDA	295.90M	278.20M	297.10M	241.60M	194.70M
Net Income	151.20M	151.90M	171.20M	128.90M	87.70M
Balance Sheet
Total Assets	682.00M	696.80M	737.90M	766.70M	716.00M
Cash, Cash Equivalents and Short-Term Investments	23.40M	46.30M	30.20M	128.60M	90.00M
Total Debt	326.60M	334.10M	330.90M	293.30M	359.00M
Total Liabilities	544.10M	559.30M	559.60M	485.50M	542.60M
Stockholders Equity	137.90M	137.50M	178.30M	281.20M	173.40M
Cash Flow
Free Cash Flow	199.90M	217.70M	225.70M	167.80M	217.90M
Operating Cash Flow	232.30M	239.50M	249.70M	183.50M	242.80M
Investing Cash Flow	-38.30M	-21.80M	-41.70M	-15.70M	-24.90M
Financing Cash Flow	-217.30M	-202.20M	-307.50M	-126.80M	-147.20M

Dunelm Group Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1163.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:DNLM, the sentiment is Neutral. The current price of 1163 is below the 20-day moving average (MA) of 1178.30, above the 50-day MA of 1143.89, and above the 200-day MA of 1039.08, indicating a neutral trend. The MACD of 5.17 indicates Positive momentum. The RSI at 49.92 is Neutral, neither overbought nor oversold. The STOCH value of 19.76 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GB:DNLM.

Dunelm Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PETS	78 Outperform	£1.18B	13.61	8.90%	4.71%	2.78%	11.20%
DNLM	76 Outperform	£2.32B	15.32	84.81%	1.77%	3.07%	1.42%
CURY	74 Outperform	£1.32B	6.74	2.95%	―	-10.46%	396.13%
SMWH	70 Neutral	£1.37B	213.76	2.46%	4.12%	4.46%	-89.55%
FRAS	69 Neutral	£2.80B	9.54	16.46%	―	-6.82%	-37.46%
Sector *	62 Neutral	$16.34B	11.01	-5.97%	3.14%	1.65%	-24.92%
THG	58 Neutral	£489.25M	―	-27.20%	―	-14.37%	-28.78%

Dunelm Group Corporate Events

Dunelm CFO Exercises Share Options and Sells Shares

Dunelm Group plc announced that its Chief Financial Officer, Karen Witts, exercised 51,496 nil cost options over ordinary shares, granted under the company’s Long Term Incentive Plan. To cover tax and national insurance liabilities, she sold 24,277 shares at £11.78 each. This transaction reflects the company’s ongoing management of executive compensation and incentives, potentially impacting shareholder perceptions and market confidence.

The most recent analyst rating on (GB:DNLM) stock is a Buy with a £13.25 price target. To see the full list of analyst forecasts on Dunelm Group stock, see the GB:DNLM Stock Forecast page.

Dunelm Group Updates Share Capital and Voting Rights

Dunelm Group plc has announced that its total issued ordinary share capital consists of 203,426,835 shares, with 2,209,399 held in treasury, resulting in 201,217,436 shares with voting rights. This information is crucial for shareholders to determine their shareholding interests under the Disclosure and Transparency Rules, impacting how they manage their investments in the company.

The most recent analyst rating on (GB:DNLM) stock is a Buy with a £13.25 price target. To see the full list of analyst forecasts on Dunelm Group stock, see the GB:DNLM Stock Forecast page.

Dunelm Group Director Increases Shareholding

Dunelm Group plc announced a transaction involving the purchase of its ordinary shares by Ajay Kavan, a Non-Executive Director. The transaction, which took place on May 7, 2025, involved the purchase of 2,621 shares at a price of 1141.79 pence per share, increasing Kavan’s beneficial holding to 7,542 shares. This transaction highlights the ongoing engagement and investment of the company’s management, potentially signaling confidence in Dunelm’s market position and future performance.

Dunelm Group Announces Total Voting Rights Update

Dunelm Group plc announced that its issued ordinary share capital consists of 203,426,835 ordinary shares, with 2,219,024 shares held in treasury, resulting in 201,207,811 shares with voting rights. This information is crucial for shareholders to determine their notification requirements under the Disclosure and Transparency Rules.

Dunelm Group Reports Strong Q3 Sales Growth and Strategic Expansion

Dunelm Group reported a strong third quarter with a 6.3% increase in sales to £462 million, driven by growth in homewares and furniture categories. Digital sales also rose, accounting for 41% of total sales. The company opened its 200th store and continues to expand its store portfolio, while maintaining a stable gross margin. Despite market uncertainties, Dunelm remains on track to meet its profit expectations for the fiscal year and aims to achieve a 10% market share in the medium term.

Dunelm Group Announces Total Voting Rights Update

Dunelm Group plc announced its total voting rights, with the current issued ordinary share capital comprising 203,426,835 shares, of which 2,234,120 are held in treasury. This leaves 201,192,715 shares with voting rights, a figure that shareholders can use to assess their interest in the company under the Disclosure and Transparency Rules.