UK&I Daily Focus: Thursday, 16th July 2026

Research evidence excerpt

UK&I Daily Focus: Thursday, 16th July 2026

Deutsche Bank

Research

Europe Strategy Date

United Kingdom 16 July 2026

UK&I Daily Focus Periodical

Thursday, 16th July 2026

Jonathan Jayarajan

LEADING STORIES Associate Director Equity Research - EMEA

B&M (BMEB.L) - Margin rebuild to provide a cushion - upgrade to Hold Products

Adam Cochrane: Sell to Hold, Tgt Unch. at 185p. Last Close 193p. The B&M Back +44-20-754-76037

to Basics strategy is a sensible answer to the sustained underperformance under Andy Chu, FCA

prior management, in our view. Our previous negative stance was predicated on Deputy Head of EMEA Equity Research

inflation pressures on lower-income consumers, pressure on B&M margins from +44-20-754-11360

price investment, value perception needing to be improved, and lack of online offer

making the brand less relevant to changing consumer habits. Whilst not all of these

issues have been resolved, we see less downward pressure on the consumer,

changes to de minimis import duty relief may be accelerated, and we believe that

1Q will represent trough UK LFL alongside a better-than-expected gross margin.

Accordingly, we increase our FY27 gross margin expectation, which sees our PBT

estimate increase by 7% to £282m, and we raise our PT to 200p from 185p. With the

stock trading on c.10x Cal 2 PE and c.11% FCF yield, we upgrade to Hold.

Figure 1: Table of Contents

DIPLOMA (DPLM.L) - Q3 strength drives another guidance upgrade

Leading Stories Page 01

David Brockton: Tgt 7200p to 7500p. Last Close 6770p. Buy. Diploma delivered Target Price Change Page 03

another period of strong organic growth in Q3 +15%, continuing the +15% Company Updates Page 03

momentum achieved in H1, despite a prior year comparative that was c.2ppts Sector Update Page 04

tougher.