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Berenberg isn’t the biggest fan of Royal Mail, but the German bank’s decision to do away with its “sell” rating for the postal group was enough to send the shares higher yesterday.
Its analysts had their usual gripes: too many workers on the books; the universal service obligation that hampers profitability; intense competition within the sector; and the “remorseless” decline in letter volumes. Nevertheless, they expected pressure on the business to relent, for the time being, anyway.
Berenberg reckons that Royal Mail will get a “short-term boost” from the latest lockdowns, which are likely to prolong the boom in parcel deliveries that emerged last year as stuck-at-home consumers bought more stuff online. Similarly, Christmas is likely to have been busy as the Tier 4 restrictions
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