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Analyst reaction: Ted Baker

As Ted Baker reports a sales increase of over 20% during the Christmas trading period, Drapers takes a look at what City analysts make of the contemporary retailer’s performance.

Peel Hunt analyst John Stevenson described Ted Baker’s Christmas trading update as “strong across all markets” and maintained a “buy” stance for shares in the retailer.

“With Ted’s global expansion continuing to drive on-going double-digit EPS growth, with scope for outperformance as stores and markets mature, we view the shares as a core sector holding,” he said.

Independent analyst Nick Bubb noted that Ted Baker’s increase in sales over the Christmas period equated to a 7% rise in sales per square foot.

Bubb also highlighted Ted Baker’s lack of promotional activity as significant.

Espirito Santo analyst Sanjay Vidyarthi described Ted Baker’s performance as “excellent” following on from the 24.6% growth the retailer reported in Q3.

The broker has increased its second half retail sales growth forecast from 18% to 22.8% as a result.

“Ted remains one of the strongest growth stories in our coverage, but given the recent share price run (up 21% since the Q3 update on 28 November 2012), we move our recommendation from buy to neutral,” he said.

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