Citi flags possible recovery in UK market, positive on Aussie retailer Nick Scali

Citi indicates a potential recovery in the UK market, highlighted by DFS Furniture's strong interim results, driven by interest rate cuts and increased housing transactions. DFS anticipates exceeding annual profit expectations, while Nick Scali, which entered the UK market in April 2024, is expected to benefit from positive market conditions. Citi forecasts a 41% sales uplift for Nick Scali's UK stores from FY25 to FY28, maintaining a "buy" rating with a price target of A$20.64. Nick Scali's shares have risen 2.1% this year, outperforming the ASX All Ordinaries index's 5.4% decline.