Macquarie considers Breville an attractive long-term portfolio holding, given the extended growth potential for the business, but downgrades to Neutral from Outperform, given the strong re-rating of the stock.
The company’s capital raising makes sense to the broker as it provides flexibility to continue investing for growth.
Entry into new markets is progressing and the current cost reductions will support the corporate structure in the event of volatility in demand stemming from the pandemic. Target is raised to $20 from $16.
Sector: Retailing.
Target price is $20.00.Current Price is $19.81. Difference: $0.19 – (brackets indicate current price is over target). If BRG meets the Macquarie target it will return approximately 1% (excluding dividends, fees and charges – negative figures indicate an expected loss).
