Cake Box specialises in making delicious, high quality, bespoke celebration fresh cream cakes in-store while customers wait. Their cakes are entirely egg free and are sold in over 100 franchise stores across the UK.
01 Sep 2020
Underlying trading strength pays dividends
Cake Box has started FY2021 positively with strong same store sales growth, new store openings and an excellent online performance. The company is not only able to repay its furlough monies, but also reward shareholders with a special dividend. Cake Box released a trading statement as such this morning.
Based on the company’s resumption of guidance, the valuation looks attractive enough to argue for investors to support what is clearly not only a robust growth story, but also one based on a strong financial model. We see a good argument for the shares to move to a premium valuation relative to its peer group and thus a share price above 200p seems perfectly reasonable in our view.