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Investing.com - JPMorgan has downgraded Super Retail Group Ltd. (ASX:SUL) from Overweight to Neutral while simultaneously raising its price target to AUD18.00 from AUD16.70.
The rating change comes despite the retailer demonstrating what JPMorgan describes as "a more resilient sales and earnings profile than feared" during the second half of fiscal year 2025, with clear growth potential for FY26 and FY27.
JPMorgan notes that sentiment around the company’s Supercheap Auto division has improved significantly over the past six months, citing better sales performance and an easier baseline to compare against over the coming eight months.
The investment bank forecasts Super Retail Group will generate profit before tax growth of 8.4% in FY26 and 5.4% in FY27, though it cautions that one-off corporate costs in FY26 overstate the company’s price-to-earnings multiple for that year.
Following the analysis, JPMorgan has upgraded its earnings per share forecasts for FY26 and FY27 by 2.4% and 1.6% respectively, but the downgrade to Neutral rating reflects the stock’s significant price appreciation over the past three months.
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