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Nick Scali (ASX:NCK), JB Hi-Fi (ASX:JBH) and Lovisa ASX:LOV)

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    Nick Scali (ASX:NCK), JB Hi-Fi (ASX:JBH) and Lovisa ASX:LOV)

    Hi James and Team Your current view on Nick Scali, JB HI-FI & Lovisa. With higher inflation and higher interest rates expected how do you see the consumer discretionary stocks to perform? I know you hold Nick Scali & JBH in your portfolios. You would expect this sector would be where consumers would hold off spending. Would you hold off buying in this sector? In particular I've never gotten set to buy NCK - what price would you pay now? regards Debbie

    Answer

    Hi Debbie,

    A good question in the current environment.

    It’s important to recognise that stocks generally lead the news, economic in this case, by around 6-months or so. The Australian Retail Sector has already corrected more than 25%, largely for the reasons you cited. The question is whether they have fallen enough to offer investors good risk/reward at current levels.

    The consumer discretionary sector represents more than 7% of the ASX200 and while we remain underweight across our portfolios, we are comfortable to dip our toe into the proverbial water at current levels.

    • Specifically, we like NCK as it makes new lows for 2026, under $15, and JBH around $76. We don’t think LOV is the business it once was, and we have no interest buying into that stock, even though it’s almost halved. We also discussed Eagers Automotive (ASX:APE) earlier in the month Here.
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    ASX200 Retailing Index
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