Blackmores’ earnings guidance remains in place but the revenue mix is likely to be materially different than normal, the broker suggests. Supermarkets and pharmacies remain open, but sales will shift to virus-related products and away from other categories. The broker assumes the net impact on profit will be minimal.
The broker expects Blackmores to cut costs and capex nonetheless but continues to believe the market is overpricing expectations beyond FY20, hence Underperform retained. Target rises to $64 from $55.
Sector: Household & Personal Products.
Target price is $64.00.Current Price is $80.00. Difference: ($16.00) – (brackets indicate current price is over target). If BKL meets the Macquarie target it will return approximately -25% (excluding dividends, fees and charges – negative figures indicate an expected loss).
