Harvey Norman (ASX:HVN) share price hits multi-year high: Can it go higher?

The Harvey Norman Holdings Limited (ASX:HVN) share price has hit a multi-year high on Friday but could still fo higher from here…

| More on:
An investor sits at her desk and stretches her arms above her head in delight.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Harvey Norman Holdings Limited (ASX: HVN) share price is on form again on Friday and is pushing higher.

In afternoon trade, the retail giant's shares are up 3.5% to a multi-year high of $4.93.

This latest gain means that the Harvey Norman share price is now up 41% over the last six months.

As a comparison, the S&P/ASX 200 Index (ASX: XJO) is up a solid 13.8% over the same period.

Why is the Harvey Norman share price at a multi-year high?

Investors have been buying Harvey Norman's shares over the last few months thanks to its strong performance during the pandemic.

In November, the retailer released a trading update which revealed stellar sales growth so far in FY 2021.

According to the release, aggregated sales revenue increased by 28.2% between 1 July and 21 November compared to the prior corresponding period.

Management advised that this was driven by strong same store sales growth across almost all regions and particularly in the ANZ market.

Harvey Norman's Australian franchisees delivered a 30.4% increase in comparable store sales and its New Zealand stores reported a 20.4% lift in comparable store sales. This includes stores that were temporarily closed due to COVID-19.

Pleasingly, Harvey Norman's profit growth has been even stronger in FY 2021 thanks to margin expansion. Between 1 July and 31 October, the company reported unaudited profit before tax growth of 160.1% on the prior corresponding period.

Can the Harvey Norman share price go even higher?

Two brokers that believe Harvey Norman's shares can still go higher are Citi and Credit Suisse.

Citi has a buy rating and $5.50 price target on its shares, whereas Credit Suisse has an outperform rating and $5.30 price target on its shares.

Citi's price target implies potential upside of over 11% even from the multi-year high it reached today. That doesn't include the very generous 45 cents per share fully franked dividend it is forecasting.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on 52-Week Highs

A cloud with a blue arrow pointing upwards through its middle symbolising a rising asx share price
52-Week Highs

7 ASX 200 shares smashing new highs on Tuesday

Here's why these companies are hitting new 52-week highs on Tuesday.

Read more »

Hands reaching high for a trophy with a sunset in the background.
52-Week Highs

6 ASX 200 shares smashing new highs while the market dives today

Do you own any of these lucky ASX 200 stocks?

Read more »

A woman wearing a top of gold coins and large gold hoop earrings and a heavy gold bracelet stands amid a shower of gold coins with her mouth open wide and an excited look on her face.
Gold

14 ASX gold stocks unearthing fresh 52-week highs today

Do you own any of these hot gold miners?

Read more »

An older female ASX investor holds a gangster-style fist pump pose showing off gold rings with dollar signs on them.
52-Week Highs

These 16 ASX 200 shares are hitting new 52-week highs today even as the market sinks

Do you own any of these lucky stocks?

Read more »

A man clenches his fists in excitement as gold coins fall from the sky.
Gold

Why this $9.6 billion ASX 200 gold stock is smashing the market today

This gold miner has hit a 52-week high on Wednesday. What's going on?

Read more »

Excited group of friends sitting on sofa watching sports on TV and celebrating.
ETFs

4 ASX ETFs that hit new 52-week highs today

These ETFs provide exposure to the gold price and companies in emerging markets.

Read more »

Two happy scientists analysing test results.
52-Week Highs

3 ASX All Ords health care shares that reached 52-week peaks today

These health care companies finished the week on a positive note.

Read more »

group of friends jump on the beach
52-Week Highs

6 ASX 300 shares that hit new 52-week highs today

Here's why these companies stood out in an otherwise lacklustre day of trading.

Read more »