MINISO Group Holding (MNSO – Research Report), the Consumer Cyclical sector company, was revisited by a Wall Street analyst on March 21. Analyst Lucy Yu from Bank of America Securities reiterated a Sell rating on the stock and has a $17.10 price target.
Lucy Yu’s rating is based on several factors, primarily focusing on MINISO Group Holding’s recent financial performance and future outlook. The company’s fourth-quarter results for 2024 fell short of expectations, with revenue and non-IFRS net profit after tax (NPAT) missing targets. This underperformance was attributed to lower-than-expected revenue growth, prompting a downward revision of the company’s earnings per share estimates for 2025 and 2026.
Additionally, Lucy Yu expressed concerns about the company’s ability to achieve positive same-store sales growth in China, as well as uncertainties surrounding margins due to the increasing contribution from direct-to-customer sales. Other factors contributing to the Sell rating include potential impacts from US tariffs, a macroeconomic slowdown, higher finance costs, and losses from the company’s investment in Yonghui. Despite some growth in overseas markets, these risks present significant downside potential, leading to a cautious outlook on the stock.