Don't sell Halfords for £400m, say brokers

It's worth more like £590m, reckon the experts.
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A news piece in today's 'Investors Chronicle' reports on last week's rumours of a £400m bid for Halfords. However, it goes further, asking brokers their opinions on whether Boots The Chemists should offload at that price.

Broker Williams de Broe predicted that Halfords will make £37m profit this year, which would value the rumoured bid at 13 times estimated earnings. A bid in the region of 15 or 16 times is thought to reflect a more reasonable price.

'Investor's Chronicle' reports that Kien Tan of Credit Lyonnais Securities said:

"Boots should not be in any desperate hurry to get rid of Halfords. Although it doesn't fit strategically, makes money."

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