Citi trims TP, earnings estimate for Australia's Michael Hill International

Michael Hill International

02/09/2024 20:34

** Citi reduces target price for Michael Hill International
 MHJ.AX  to A$0.57 and maintains "Neutral" rating
    ** Brokerage reduces FY25 and FY26 EBIT estimates for co by
19% and 28%, respectively
    ** Brokerage expects co's gross profit (GP) margin to
recover in FY25 given - the 2H24 GP margin decline was at least
partly due to intentional clearance activity, margin benefit
arising from co's refreshed inventory and focus on higher margin
products, others
    ** "Refresh inventory targeting higher margin products,
multi-brand strategy to clearly define offering to customers,
and a new brand targeting different customer aspirations in
trial phase. We think FY25 will be a year that proves these
concepts."- Citi 
    ** MHJ posted on Friday FY24 loss of A$479,000 compared to
profit of A$35.2 mln ($23.81 mln) in FY23
    ** Stock has fallen 38.1% this year, as of last close

 (Reporting by Sherin Sunny in Bengaluru; Editing by Sandra
Maler)
 ((Sherin.Sunny@thomsonreuters.com))