Currys: From repair to reward

Currys (CURY) has spent the past two years rebuilding from the inside out. Once seen as a struggling high street chain, it has quietly reshaped itself into a cash generating, digitally integrated retailer with a clear path to sustainable profitability. The result is a business that is leaner, more focused and far stronger than many investors give it credit for.

A turnaround built on cash and control

Currys’ financial turnaround has been steady, measured and genuine. After years of declining margins and heavy debt, the company has restored financial discipline. For the year to April 2025, revenue grew 3% to £8.7bn while operating profit climbed to £198m, reversing the losses seen during its restructuring period. Free cash flow has strengthened considerably, helped by tighter working capital management, improved logistics and a sharper focus on profitable categories.

Net debt has fallen to £786m and management expects to finish the current year in a net cash position. The latest triennial pension review cut the scheme’s deficit from £403m to £134m and reduced future annual contributions from £78m to just £13m starting in 2026. That saving alone transforms future cash generation. The company’s decision to keep capital expenditure below £100m per year and focus on free cash flow reinforces the impression of a business that is finally living within its means.

Currys’ recovery has not relied on cost cutting alone. Its mix of products and services has evolved, with growing demand in AI computing, gaming, smart home devices and connected appliances helping offset weaker categories such as tablets and TVs. Services like iD Mobile, now above 2.3 million subscribers, and extended credit options have added a layer of recurring revenue that supports margins even in slower retail periods.

A retailer with new growth drivers

What sets Currys apart from other cyclical retailers is its ability to balance technology retailing with higher margin services. The UK and Ireland division remains the profit engine, supported by growing credit adoption and a push into B2B sales. The Nordics, which had dragged on group performance in 2023, are now stabilising, with management successfully tightening cost control and refocusing on more profitable product lines.

Currys’ omnichannel model remains a significant competitive advantage. With over 700 stores integrated into its online network, it combines physical presence with digital convenience. That allows the company to deliver what pure online rivals cannot offer, product expertise, service and same day support. The result is improved customer loyalty and a stronger brand presence in an otherwise crowded market.

The business has also shown discipline in capital allocation. Following a period of restructuring and disposals, management now operates with a clear framework: maintain a prudent balance sheet, invest selectively, pay consistent dividends and return surplus capital via buybacks. This structure gives investors confidence that the lessons of the past decade will not be repeated.

A September catalyst in a bigger story

While the turnaround story has been building since early 2024, the trading update released on 4 September 2025 provided clear evidence that the recovery was taking hold. The company reported group like for like revenue growth of 3%, with both the UK and Nordics delivering positive momentum. In the UK, sales were supported by strong demand in AI computing, large appliances and B2B, while services and credit adoption continued to climb.

This combination of fundamental progress and technical consolidation has created an appealing entry zone. It is a chance to participate in a recovery that still feels early in its rerating phase.

Valuation still too low for the progress made

Despite its achievements, the market continues to value Currys like a business stuck in transition. The shares trade on a forward PE of just 10.7x, EV to EBITDA of 4.6x and price to book of 0.65x, all metrics that suggest deep value rather than mature recovery. With free cash flow improving and long term EPS growth forecast around 5%, those multiples look far too low for a business now generating sustainable profits.

The dividend yield, just under 2%, is not the main draw, but coverage is healthy and likely to grow as debt continues to fall. Analysts’ consensus price target of roughly 160p implies over 20% upside from current levels, which looks realistic if margins continue to expand and the buyback provides underlying support.

The gap between perception and performance remains wide. Investors are still pricing Currys as a turnaround that might work, when in reality, it already has.

Key Takeaways

1. Compelling valuation: With a forward PE of 10.7x and improving margins, the shares remain undervalued for the progress made.

2. Ongoing turnaround: Currys has rebuilt its business with stronger cash flow, lower debt and a clearer strategy.

3. New growth drivers: Services, credit adoption and iD Mobile are boosting recurring revenue and profitability.

4. Positive trading update: September’s results confirmed the recovery is gaining pace across the UK and Nordics.

5. Attractive entry point: The 10% pullback offers a chance to buy within a long-term uptrend supported by rising averages.