3 June 2022

Chami Ratnapala 612 8224 2845

Chris Savage 612 8224 2835

Accent group Ltd (AX1)

Multi-faceted retailer

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

Staff MemberTitle/SectorPhone@bellpotter.com.au
Chris SavageHead of Research/Industrials612 8224 2835csavage
John HesterHealthcare612 8224 2871jhester
Anubhav SaxenaHealthcare612 8224 2846asaxena
Tara SperanzaHealthcare612 8224 2815tsperanza
Michael ArdreyIndustrials613 9256 8782mardrey
Marcus BarnardIndustrials618 9326 7673mbarnard
Sam BrandwoodIndustrials612 8224 2850sbrandwood
Olivia HagglundIndustrials612 8224 2813ohagglund
Hamish MurrayIndustrials613 9235 1813hmurray
Chami RatnapalaIndustrials612 8224 2845cratnapala
Jonathan SnapeIndustrials613 9235 1601jsnape
David CoatesResources612 8224 2887dcoates
Stuart HoweResources613 9235 1856showe
Brad WatsonResources618 9326 7672bwatson
Regan BurrowsResources618 9326 7677rburrows
Joseph HouseResources613 9235 1624jhouse
Daniel LaingAssociate Analyst613 9256 2886dlaing
Thomas SimaAssociate Analyst612 8224 2843tsima


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