3 June 2022
Chami Ratnapala 612 8224 2845
Chris Savage 612 8224 2835
Accent group Ltd (AX1)
Target (12 months)
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
|Chris Savage||Head of Research/Industrials||612 8224 2835||csavage|
|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|
|Daniel Laing||Associate Analyst||613 9256 2886||dlaing|
|Thomas Sima||Associate Analyst||612 8224 2843||tsima|
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