Credit Suisse suspects investor debates will be heightened after the results, with rising costs countering strong growth in sales revenue and resulting in a flat profit outcome from the automotive and sports divisions.
The main issue is whether the company can contain costs growth and leverage the strong top-line into profit. Credit Suisse is not entirely comfortable about the outcome but, on balance, forecasts accelerating profit growth in FY21.
Neutral maintained. Target rises to $9.94 from $9.46.
Sector: Retailing.
Target price is $9.94.Current Price is $9.60. Difference: $0.34 – (brackets indicate current price is over target). If SUL meets the Credit Suisse target it will return approximately 3% (excluding dividends, fees and charges – negative figures indicate an expected loss).
