Shares in greeting cards-to-gifts retailer Card Factory (CARD)
have surged since the delivery of a surprise bumper upgrade (15 November) to full year earnings guidance and have bucked the retail sector gloom with an 18% gain year-to-date.

Signs that CEO Darcy Willson-Rymer’s refreshed growth strategy is working and hopes the retailer’s strong value proposition will resonate with consumers dealing with a cost-of-living crisis have helped drive the stock higher, while Liberum Capital thinks Card Factory is at the start of an upgrade cycle for earnings estimates.

The Wakefield-headquartered shopkeeper now expects to deliver year-to-January 2023 earnings before interest, tax, depreciation and amortisation (EBITDA) of ‘at least £96 million’, comfortably ahead of the previous £88.8 million consensus forecast and which should drop through to pre-tax profits of £37.5 million.

Card Factory has seen stronger than expected second-half trading, particularly in stores and across ‘everyday’ ranges, and enjoyed a ‘marginally’ better than anticipated start to the Christmas selling season.

The update also provided relief on the supply chain front, with Card Factory assuring investors that ‘all internationally sourced seasonal stocks have been landed in the UK, with a significant proportion already delivered to store’.

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