JPMorgan upgrades Coles Group stock rating to Neutral on valuation

Published 17/07/2025, 11:40
JPMorgan upgrades Coles Group stock rating to Neutral on valuation

Investing.com - JPMorgan has upgraded Coles Group Ltd . (ASX:COL) (OTC:CLEGF) from Underweight to Neutral while maintaining its price target of AUD20.00.

The upgrade follows a recent de-rating of the stock ahead of the company’s fiscal year 2025 results, with JPMorgan noting that Coles has traded down toward the firm’s unchanged price target due to consensus earnings risks.

JPMorgan has revised its earnings forecasts for Coles Group, lowering group earnings by 0.7% for FY25, 1.8% for FY26, and 0.6% for FY27.

The firm identified supermarket EBIT (earnings before interest and taxes) downgrades as the key driver behind these revisions, citing operating deleverage due to lower sales and higher wage costs, though these factors were partially offset by an upgrade to Liquor earnings.

JPMorgan’s EBIT projections now fall below consensus estimates by 1.8% for FY25, 3.8% for FY26, and 1.9% for FY27.

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