Wesfarmers shares could be great value according to analysts at Morgans…
The post Morgans tips 40% upside for the Wesfarmers share price appeared first on The Motley Fool Australia. –
The Wesfarmers Ltd (ASX: WES) share price could be great value at the current level.
Thatâs the view of one of Australiaâs leading brokers.
Why is the Wesfarmers share price great value?
A recent note out of Morgans reveals that its analysts have retained their add rating with a $58.40 price target.
Based on the current Wesfarmers share price, this implies potential upside of 40% for investors over the next 12 months.
Its analysts are fans of Wesfarmers due to their belief that it âpossesses one of the highest quality retail portfolios in Australia with strong brands including Bunnings, Kmart and Officeworks.â
The broker also highlights that âthe company is run by a highly regarded management team and the balance sheet is healthy.â
What else is the broker saying?
In addition, Morgans believes that Wesfarmers is well-positioned for a tough retail environment. This is due to partly to its focus on value with its popular Kmart business. It explained:
Kmartâs scale and sourcing capabilities underpin its low-cost business model, which allows it to deliver the lowest prices, driving greater demand and scale, and allows further sourcing and product development capabilities.
With value expected to become increasingly important, we think Kmart is well-placed to benefit with the average price of an item at around $6-7. Even if price rises are needed to mitigate cost inflation, this will be small on an absolute basis (eg, a 5% increase in average selling price = ~35c) and Kmart can use its scale and supply chain flexibility to limit increases vs its competitors.
All in all, the broker sees the company âas a long-term, core portfolio holdingâ and appears to believe the recent weakness in the Wesfarmers share price is a buying opportunity for investors.
The post Morgans tips 40% upside for the Wesfarmers share price appeared first on The Motley Fool Australia.
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.* Scott just revealed what he believes could be the “five best ASX stocks” for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now
See The 5 Stocks
*Returns as of January 12th 2022
setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
Why I think these 2 ASX 200 dividend shares offer great buying right now
2 ASX companies busted for sneaky facial recognition on customers
Why are these ASX 200 retail shares lagging the market today?
Should you buy these top blue chip ASX 200 shares after the market selloff?
Should income investors buy Wesfarmers shares for the dividends?
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.