SHARE OF THE WEEK: Bosses hope results will boost Dunelm investors

Dunelm shareholders have had a rollercoaster ride since Covid first closed its 177 stores nearly three years ago.

After recovering from a pandemic-induced slump, the value of the furniture retailer plummeted again last February when Vladimir Putin invaded Ukraine. Investors fled on fears that rising inflation would cause consumers to cut back on major purchases, such as new couches and tables.

But in the past six months, shares are up 37 percent following a stellar Christmas trading update and amid growing signs that people are still spending money despite tightness in the cost of living. Dunelm has also been buoyed by the explosive sales of the company’s £14 indoor heater, which has made headlines for helping households stay warm on a budget.

Bosses hope Dunelm’s results on Wednesday — covering the six months to the end of December — give investors more reason to cheer. Analysts will be eager to know how much the company’s own rising costs are eating away at earnings.

Hargreaves Lansdown analyst Susannah Streeter said: ‘Dunelm has shown toughness amid cost-of-living headwinds. The product range proved to be the right mix as customers navigated through the cost of living crisis and the cold snap, with the winter warm range proving attractive.”

Dunelm shares closed 2.6 percent, or 31 pence, yesterday at 1155 pence – about a quarter below its high during a home improvement boom between strict Covid lockdowns.