Wesfarmers’ FY21 performance met expectations, plus the company announced a $2.3bn capital return program. Earnings estimates have lifted but Citi continues to have a problem with the valuation, hence the Sell rating remains in place.
Citi analysts spotted many topics that are typical for retailers in 2021: supply-chain disruptions, rising freight and commodity costs, transition to online, on top of increasing investment in digital and automation.
Ongoing lockdowns are creating headwinds of their own. Target price climbs to $49 from $47.
Sector: Food & Staples Retailing.
Target price is $49.00.Current Price is $62.20. Difference: ($13.20) – (brackets indicate current price is over target). If WES meets the Citi target it will return approximately -27% (excluding dividends, fees and charges – negative figures indicate an expected loss).
