Jefferies starts Australia's Reliance Worldwide with "sell"

Reliance Worldwide

04/04/2022 23:27

** Jefferies initiates coverage on Australia's Reliance
Worldwide Corporation Ltd  RWC.AX  with "sell" rating, with
valuation at A$4.00
    ** Brokerage positive on company's long-term growth
prospects but says the company is facing some issues in the
near-term, which it sees as potential downside risks to current
consensus earnings
    ** Brokerage says key concerns for the short-term are
overstocking by customers in UK, which has to unwind out of
inventory balances and the time to attain required margin levels
in the U.S. market 
    ** In the long-term, broker says it expects larger
opportunity growing within the U.S. and a high percentage of
incremental sales as RWC is under penetrated in the U.S.
wholesale channel
    ** Eight of 11 analysts rate the stock "buy" or higher,
three "hold"; their median PT is A$5.80– Refinitiv data

 (Reporting by Archishma Iyer)
 ((Archishma.Iyer@thomsonreuters.com;))