Citi sees Australian retailers facing implications from reduced U.S. consumer spending

ARB

18/12/2022 21:38

** Citi says US Household Available Cashflow (HAC) analysis
indicates U.S. consumers are likely to have less cash to spend
on discretionary items in 2023 
    ** Brokerage says Australia's City Chic Collective  CCX.AX 
will be most impacted as 42% of its FY23 estimated sales comes
from U.S.
    ** While HAC outlook appears unfavourable for Lovisa’s
 LOV.AX  FY23 US sales outlook, Citi sees co's younger target
consumer to fair better in a challenging retail environment
    ** Brokerage adds LOV's rapid store expansion could offset
any underlying sales slowdown
    ** Citi says thought HAC outlook is a demand-side headwind
for ARB Corporation's  ARB.AX  U.S. sales, it still likes ARB’s
longer term prospects 
    ** Three of 12 analysts rate CCX "buy" or higher, eight
"hold" and one "sell" ; their median PT is A$1.14 – Refinitiv
data
    ** Eight of 13 analysts rate LOV "buy" or higher, three
"hold" and two "sell" or lower ; their median PT is A$26.32 –
Refinitiv data
        ** Six of eight analysts rate ARB "buy" or higher, two
"hold"; their median PT is A$32.62 – Refinitiv data
    ** ARB and CCX are down 47.1% and 88.7% YTD respectively,
while LOV is up 14.9% YTD , as of last close   
 (Reporting by Nausheen Thusoo in Bengaluru; Editing by Daniel
Wallis)
 ((Nausheen.Thusoo@thomsonreuters.com;))