There are a good number of options on the Australian share market for investors looking for exposure to the retail sector.
But which ASX retail shares are in the buy zone right now? Well, six that analysts at Bell Potter are bullish on are listed below.
But first, let's take a look at what the broker is saying about the sector. Commenting on the retail sector, Bell Potter said:
We make earnings changes to LOV & TPW driven by medium to long term revisions and PFP as we factor in the acquisitions announced yesterday. We also increase our target earnings multiples for LOV & UNI which see our LOV, UNI, TPW & PFP price targets increasing 17%, 9%, 6% and 2% respectively. We've seen the Consumer Disc. sector (ASX200) testing its 10-year median P/E multiple (20.5x) back in Jul-23, however materially re-rating since then towards a high point in late Mar-24 (25.8x), and thereafter a correction back to 22.5x.
In this backdrop, we identify key opportunities where the valuations are well supported by distinctive growth traits and also clearly identifiable large TAM opportunities. Our key picks are the two global rollout names, LOV & PMV and also AX1 & UNI given the potential income tax cut benefit from 1Q25 to the younger consumer demographic and short-term catalysts for UNI associated with fast-approaching supportive comps.
Let's now take a look at six ASX retail shares that the broker is recommending as buys. They are as follows:
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Accent Group Ltd (ASX: AX1)
Bell Potter has a buy rating and $2.50 price target on this footwear retailer's shares. This implies potential upside 25% for investors from current levels.
Cettire Ltd (ASX: CTT)
This online luxury products retailer's shares could be great value following recent weakness. The broker has a buy rating and $3.01 price target on its shares, which suggests potential upside of 28% for investors.
City Chic Collective Ltd (ASX: CCX)
Bell Potter has a buy rating and 62 cents price target on this plus sized women's fashion retailer's shares. Based on its current share price of 28 cents, this implies that its shares could more than double in value from current levels.
Lovisa Holdings Ltd (ASX: LOV)
Another ASX retail share that the broker is bullish on is fashion jewellery retailer Lovisa. It has a buy rating and $36.00 price target, which suggests that they could rise of 15% for investors.
Premier Investments Limited (ASX: PMV)
Bell Potter thinks that Smiggle and Peter Alexander owner Premier Investments could be in the buy zone. The broker has a buy rating and $35.00 price target on its shares. This implies potential upside of 21% for investors.
Universal Store Holdings Ltd (ASX: UNI)
A final ASX retail share that could be a buy is Universal Store. Bell Potter has a buy rating and $6.15 price target on the youth fashion retailer's shares. Based on its current share price of $5.12, this would mean potential upside of 20%.
