Cake Box looks tasty according to one City broker

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Cake Box Holdings PLC (LON:CBOX) shares are significantly undervalued, according to comprehensive research carried out by Liberum.

Its 21-page note on the franchise retailer culminates in a ‘buy’ recommendation and 265p price target. To put the latter in perspective, the stock is currently changing hands for 167p.

As well as lauding the company’s resilience since the lifting of lockdown restrictions and its online growth, Liberum has spied two potential value kickers that haven’t been picked up on by the wider market.

Cake Box’s plans to start its own delivery service, along with offering its sweet treats on other platforms, “could be a game-changer for the business as it brings in previously inaccessible customers”.

At the same time, Liberum reckons the company’s franchisees have come out of lockdown “unscathed”.

“The aftermath in the property market, along with the success of Cake Box, could lead to higher demand for new franchisees,” it observed.

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