AX1 - Morgan Stanley rates the stock as Overweight
PUBLISHED
2022-04-29
Content
At first glance, Accent Group's March quarter update indicated sales remain subdued, albeit up from a -10% contraction a year ago, and gross margins are ahead year on year. Supply delays remain ongoing.
The company will restrcuture into three groups -- retail, distribution and vertical & apparel brands. Morgan Stanley sees the changes as incremental, but belieeves the positive thesis of store rollouts, reopening leverage and structural growth in active-wear remains intact.
With valuation attractive, Overweight and $2.70 target retained. Industry View: In-Line
Sector: Retailing.
Target price is $2.70.Current Price is $1.45. Difference: $1.25 - (brackets indicate current price is over target). If AX1 meets the Morgan Stanley target it will return approximately 46% (excluding dividends, fees and charges - negative figures indicate an expected loss).