Accent group Ltd (AX1)

Multi-faceted retailer

Recommendation
Buy
Price
$1.34
Target (12 months)
$2.20

COVID Recovery Beckons

We transfer analyst coverage of Accent Group and reiterate our Buy rating at a $2.20/share Price Target (PT). AX1 is currently trading on 9.8x FY23e P/E (BPe) which we think looks conservative given its dominant market share in the Australian footwear retailing industry and growth outlook in the youth focused sports apparel vertical. We think AX1 has a long runway ahead in terms of the athleisure market opportunity and is well placed to gain share given its accelerated vertical sales strategy. We sit ~6% ahead of consensus NPAT expectations for FY24e primarily driven by higher store based revenues & vertical sales assisted by the Glue Store roll out which in our view should see overall margin expansion through the medium term.

Investment Thesis in Charts

Recent updates & Peer results

Staff Member	Title/Sector	Phone	@bellpotter.com.au
Chris Savage	Head of Research/Industrials	612 8224 2835	csavage
Analysts
John Hester	Healthcare	612 8224 2871	jhester
Anubhav Saxena	Healthcare	612 8224 2846	asaxena
Tara Speranza	Healthcare	612 8224 2815	tsperanza
Michael Ardrey	Industrials	613 9256 8782	mardrey
Marcus Barnard	Industrials	618 9326 7673	mbarnard
Sam Brandwood	Industrials	612 8224 2850	sbrandwood
Olivia Hagglund	Industrials	612 8224 2813	ohagglund
Hamish Murray	Industrials	613 9235 1813	hmurray
Chami Ratnapala	Industrials	612 8224 2845	cratnapala
Jonathan Snape	Industrials	613 9235 1601	jsnape
David Coates	Resources	612 8224 2887	dcoates
Stuart Howe	Resources	613 9235 1856	showe
Brad Watson	Resources	618 9326 7672	bwatson
Regan Burrows	Resources	618 9326 7677	rburrows
Joseph House	Resources	613 9235 1624	jhouse
Associates
Daniel Laing	Associate Analyst	613 9256 2886	dlaing
Thomas Sima	Associate Analyst	612 8224 2843	tsima

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