Following a 3Q trading update by JB Hi-Fi, UBS notes strengthening sales growth in February and March, reflective of strong consumer demand.
The broker also liked the disciplined cost control, stock availability and sales mix, while The Good Guys showed gross margin expansion.
The $54 target price and Neutral rating are retained after upgrades to the broker’s EPS estimates due to stronger JB Australia sales and earnings margins.
Meanwhile an unfavourable exchange rate lowered New Zealand earnings estimates and the recently announced buyback was also incorporated into UBS’ estimates.
Sector: Retailing.
Target price is $54.00.Current Price is $54.60. Difference: ($0.60) – (brackets indicate current price is over target). If JBH meets the UBS target it will return approximately -1% (excluding dividends, fees and charges – negative figures indicate an expected loss).
