It certainly hasn't been a great start to the week for the Super Retail Group Ltd (ASX: SUL) share price.
At the time of writing the retailer's shares are down 3.5% to $7.85, having recovered slightly from an eight-week low of $7.70 in earlier trade.
Why are its shares lower?
With no news out of the company and no broker notes that I'm aware of, today's decline is a bit of a mystery.
Especially given that last week no less than four leading brokers revealed that they had retained their buy ratings on the retailer's shares following the release of a positive trading update.
Analysts at Morgans and UBS have buy ratings and $9.00 price targets, UBS has a buy rating and $9.50 price target, and finally Deutsche Bank has a buy rating and $11.00 price target for Super Retail's shares.
These brokers appear to have been impressed that like for like sales are up across all three of its retail segments during the first 16 weeks of FY 2018 despite the weak trading conditions.
Its Auto Retailing segment has been the standout with sales up 6% or 4% on a like for like basis.
Elsewhere sales from its Leisure Retailing segment are up 7% or 2% on a like for like basis, and its Sports Retailing segment has delivered a 5% lift in sales or 2% on a like for like basis.
Should you buy the dip?
I think the drop in its share price today is a buying opportunity. Especially as it means its shares are changing hands at just over 11x trailing earnings.
Based on the lowest broker price target mentioned above, there is potential upside of almost 15% for its shares over the next 12 months. This extends to almost 21% if you factor in its generous dividend.
I believe this provides investors with a compelling risk/reward and would therefore put it up there with fellow retailers Bapcor Ltd (ASX: BAP) and Premier Investments Limited (ASX: PMV) as one of the best options in the retail sector.
