The first quarter trading update revealed GWA Group’s Australian sales were up 6% while New Zealand sales were down -32%. The latter was affected by the 5-week impact from lockdowns. A strong rebound has occurred in NZ sales in late September.
Macquarie believes the buoyant renovations market should continue for some time and the backlog of new building work has been extended through supply chain constraints.
Outperform retained. Target is raised to $3.30 from $3.25.
Sector: Capital Goods.
Target price is $3.30.Current Price is $2.72. Difference: $0.58 – (brackets indicate current price is over target). If GWA meets the Macquarie target it will return approximately 18% (excluding dividends, fees and charges – negative figures indicate an expected loss).
