We looked at SUL in detail last month, here, and we were neutral at the time ~$13 and its hard to get too excited, even with the stock lower, ahead of its FY26 result on Thursday.
Positives
- The company operates four major retail brands, Supercheap Auto, Rebel, BCF and Macpac, which are oriented around automotive accessories, sport, outdoor recreation, i.e. they aren’t specifically influenced by housing or AI.
- SUL is forecast to yield ~7% fully franked over the next 12-months.
- The stock is not “cheap” at the moment, trading around its long-term historical valuation.
Negatives
- A CEO termination, repeated earnings misses, margin deterioration and a weak May trading update have driven SUL to a four-year low, sharply underperforming both ASX Consumer Discretionary (-8.6%) and the broader market (+5.7%).
SUL operates in a “safer” corner of retail than JBH and HVN, but it needs to regain investor confidence.
- We like SUL due to its lack of housing market exposure but need a catalyst to press any “Buy” button.
MM is neutral towards SUL around $12
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