Australia's Blackmores FY24 revenue, margin targets at risk of downgrade - Citi

Blackmores

24/02/2022 22:18

** Citi says nutritional supplements maker Blackmores'
 BKL.AX  guidance that two-thirds of annual earnings would come
from H1 implies a weaker-than-expected H2 
    ** BKL on Thursday reported higher H1 results but did not
provide a profit forecast for the remainder of FY22, and said it
expects H2 sales growth in China to be below H1  urn:newsml:reuters.com:*:nAZN0273MF
    ** Potential for weaker-than-expected FY22 performance
suggests downside risk is increasing to BKL's FY24 revenue and
margin targets - Citi, maintains "sell" rating
    ** Brokerage questions how sustainable BKL's profits are in
China given increasing consumer preference for domestic vitamin
brands and a lack of strategic partners
    ** Cuts FY22 net profit after tax estimates by 20%, but FY23
and FY24 views remain broadly unchanged
    ** Citi still raises PT by 9% to A$73.16 due to improving
valuation
    ** 2 of 10 brokerages rate the stock "buy", 4 "hold" and 4
"sell" or lower; median PT is A$92.30
    ** Up to Thursday's close, stock down 7.8% this year

 (Reporting by Shashwat Awasthi)
 ((Shashwat.Awasthi@tr.com
mailto:Shashwat.Awasthi@thomsonreuters.com))