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Investing.com - Goldman Sachs downgraded J. Front Retailing Co., Ltd (3086:JP) (OTC:JFROF) from Buy to Neutral on Thursday, while raising its price target to JPY2,000.00 from JPY1,850.00.
The downgrade follows a 12% rise in J. Front’s share price between May 16 and June 18, compared to the TOPIX index’s 2% gain during the same period. The stock’s performance was driven by increased investor interest in unrealized real estate gains held by Japanese department stores after media reports on May 16.
Goldman Sachs noted the stock is now trading near fair value with approximately 3% downside potential, compared to a 1% average downside for its retail sector coverage. The firm cited J. Front’s net asset value multiple of 0.6X based on post-tax NAV calculated from unrealized gains on real estate.
The investment bank raised its price target despite lowering earnings estimates, reflecting sales trends through the first half of June that J. Front has already disclosed. Goldman Sachs still expects the company to miss its fiscal year February 2026 guidance.
The updated price target incorporates the new earnings estimates and an updated equity risk premium, according to the research note issued Thursday.
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