Reject Shop Limited (TRS) AI Stock Analysis

• Market Cap: €246.99M
• Dividend Yield: 1.98%
• Average Volume (3M): 107.28K
• Price to Earnings (P/E): 39.9
• Beta (1Y): 0.25
• Revenue Growth: 3.37%
• EPS Growth: -25.24%
• Country: AU
• Employees: 4,000
• Sector: Consumer Cyclical
• Sector Strength: 66
• Industry: Discount Stores
• EPS (TTM): 0.17
• Shares Outstanding: 37,365,917
• 10 Day Avg. Volume: 86,608
• 30 Day Avg. Volume: 107,276
• PEG Ratio: 1.21
• Price to Book (P/B): 1.31
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 2.38
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €5.97
• Price Target Upside: -9.71% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 73 Outperform
• Price Target: ―

Reject Shop Limited's overall stock score reflects a robust financial foundation characterized by revenue growth and efficient cash flow management. However, the high P/E ratio points to potential overvaluation, and profitability metrics require improvement. A strong technical position supports confidence in the stock's upward trajectory.

Reject Shop Limited Business Overview & Revenue Model

Company Description

Reject Shop Limited (TRS) is an Australian discount variety retailer offering a diverse range of general merchandise products, including homewares, cosmetics, toiletries, snacks, and seasonal items. With a focus on affordability, TRS operates in the retail sector, primarily catering to cost-conscious consumers seeking value for money on everyday essentials and unique finds.

How the Company Makes Money

Reject Shop Limited generates revenue primarily through the sale of a wide range of low-cost merchandise across its network of retail stores in Australia. The company leverages high-volume sales of discounted products to drive revenue. Key revenue streams include sales from categories such as homewares, personal care items, and consumables. TRS's earnings are significantly influenced by its ability to manage supply chain costs and negotiate favorable terms with suppliers, enabling it to offer competitive pricing. Additionally, strategic store locations and seasonal promotions contribute to its revenue generation, attracting both regular and new customers.

Reject Shop Limited Financial Statement Overview

Summary

Reject Shop Limited displays a solid financial performance with strengths in revenue growth and cash flow generation. While profitability metrics and leverage levels require attention, the company's stable equity ratio and cash conversion efficiency contribute to its resilience.

Income Statement

The Reject Shop Limited has shown a consistent increase in total revenue over recent years with a revenue growth rate of 4.1% from 2023 to 2024. Gross profit margin is healthy at 27.9%, and the net profit margin, though modest at 0.6%, indicates profitability. EBIT and EBITDA margins are 2.0% and 14.7%, respectively, suggesting operational efficiency, but there's room for improvement in net income growth.

Balance Sheet

The company's debt-to-equity ratio stands at 1.39, reflecting moderate leverage that might pose a risk if not managed carefully. The return on equity of 2.8% indicates limited profitability on shareholder investment. However, an equity ratio of 34.7% provides a cushion against liabilities, showing a stable financial structure but highlighting the need for enhanced profitability.

Cash Flow

Reject Shop Limited maintains strong cash flow generation with a free cash flow of AUD 86.4 million in 2024, though it decreased from the previous year. The operating cash flow to net income ratio is robust at 21.7, indicating strong cash conversion efficiency. The free cash flow to net income ratio of 18.3 suggests that the company effectively converts profits into cash, supporting operations and investment activities well.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
866.17M	852.74M	819.34M	788.24M	778.69M	820.64M
	Gross Profit
300.58M	341.07M	224.11M	218.37M	211.14M	229.10M
	EBIT
18.45M	17.25M	18.11M	22.98M	19.56M	10.64M
	EBITDA
79.42M	125.44M	129.64M	125.67M	128.53M	122.69M
	Net Income Common Stockholders
6.17M	4.71M	10.31M	7.90M	8.32M	1.12M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
53.44M	49.88M	77.33M	77.47M	73.05M	92.49M
	Total Assets
527.17M	490.74M	502.39M	483.73M	401.81M	424.13M
	Total Debt
226.58M	236.22M	228.43M	217.66M	167.13M	193.72M
	Net Debt
173.15M	186.34M	151.09M	140.20M	94.08M	101.23M
	Total Liabilities
394.88M	320.65M	320.45M	306.92M	245.08M	281.06M
	Stockholders Equity
132.28M	170.08M	181.94M	176.80M	156.73M	143.06M
Cash Flow		Free Cash Flow
103.74M	86.37M	98.89M	99.69M	76.32M	156.70M
	Operating Cash Flow
119.44M	102.11M	111.02M	116.14M	87.09M	167.38M
	Investing Cash Flow
-15.70M	-15.74M	-12.13M	-16.45M	-10.78M	-10.68M
	Financing Cash Flow
-109.52M	-113.82M	-99.03M	-95.27M	-95.76M	-90.52M

Reject Shop Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.61
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:TRS, the sentiment is Positive. The current price of 6.61 is below the 20-day moving average (MA) of 6.62, above the 50-day MA of 6.54, and above the 200-day MA of 3.86, indicating a neutral trend. The MACD of 0.09 indicates Positive momentum. The RSI at 66.41 is Neutral, neither overbought nor oversold. The STOCH value of 8.33 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:TRS.

Reject Shop Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TRS	73 Outperform	€246.99M	39.92	3.33%	1.98%	3.37%	-25.24%
HVN	73 Outperform	$6.80B	15.75	9.58%	4.48%	1.77%	15.57%
SUL	73 Outperform	AU$3.21B	14.18	17.52%	4.85%	2.56%	-13.62%
PMV	71 Outperform	AU$3.24B	16.35	14.01%	6.57%	-27.48%	-27.96%
Sector *	63 Neutral	$6.96B	11.51	2.80%	3.85%	2.70%	-24.43%
MYR	61 Neutral	€1.19B	24.73	8.55%	5.59%	-2.43%	-49.64%

Reject Shop Limited Corporate Events

Harvest Lane Increases Stake in Reject Shop Limited

Harvest Lane Asset Management and its associated entities have increased their substantial holding in Reject Shop Limited, now owning 6.43% of the company’s ordinary shares. This change in substantial holding reflects a strategic move by Harvest Lane, potentially impacting the company’s market positioning and signaling confidence in Reject Shop’s future performance.

The most recent analyst rating on (AU:TRS) stock is a Hold with a A$3.70 price target. To see the full list of analyst forecasts on Reject Shop Limited stock, see the AU:TRS Stock Forecast page.

Pinnacle Investment Acquires Significant Stake in The Reject Shop

Pinnacle Investment Management Group Limited has become a substantial holder in The Reject Shop Limited as of May 16, 2025, with a 7.29% voting power through its acquisition of 2,725,136 ordinary fully paid shares. This development indicates a significant investment interest in The Reject Shop, potentially impacting its market positioning and stakeholder dynamics.

The most recent analyst rating on (AU:TRS) stock is a Hold with a A$3.70 price target. To see the full list of analyst forecasts on Reject Shop Limited stock, see the AU:TRS Stock Forecast page.

Plato Investment Management Acquires Substantial Stake in The Reject Shop

Plato Investment Management Limited has become a substantial holder in The Reject Shop Limited, acquiring a 6.5% voting power with 2,428,437 ordinary fully paid shares as of May 16, 2025. This acquisition signifies a notable interest from Plato Investment Management in The Reject Shop, potentially impacting the company’s market positioning and signaling confidence in its future prospects.

The most recent analyst rating on (AU:TRS) stock is a Hold with a A$3.70 price target. To see the full list of analyst forecasts on Reject Shop Limited stock, see the AU:TRS Stock Forecast page.

Bennelong Funds Management Sells Stake in Reject Shop

Bennelong Funds Management Group Pty Ltd has ceased to be a substantial holder of The Reject Shop Limited as of May 19, 2025. This change occurred following the sale of 2,760,578 ordinary shares on the market, impacting the voting power and potentially altering the shareholder composition of the company.

The most recent analyst rating on (AU:TRS) stock is a Hold with a A$3.70 price target. To see the full list of analyst forecasts on Reject Shop Limited stock, see the AU:TRS Stock Forecast page.

The Reject Shop Announces Acquisition Proposal by Dollarama

The Reject Shop Limited has announced a proposed acquisition by Dollarama Inc. through a scheme of arrangement. The company’s board unanimously recommends shareholders vote in favor of the scheme, which offers $6.68 cash per share, exceeding the assessed value range of $4.80 to $5.24. The Independent Expert has deemed the scheme fair and reasonable, and the largest shareholder, Kin Group Pty Ltd, intends to support the proposal. This acquisition could significantly impact The Reject Shop’s operations and market positioning.

The most recent analyst rating on (AU:TRS) stock is a Hold with a A$3.70 price target. To see the full list of analyst forecasts on Reject Shop Limited stock, see the AU:TRS Stock Forecast page.

Court Approves Scheme Meeting for The Reject Shop’s Acquisition by Dollarama

The Reject Shop Limited has received court approval to convene a meeting for its shareholders to vote on a proposed acquisition by Dollarama Inc. through a scheme of arrangement. The board of The Reject Shop recommends shareholders vote in favor of the scheme, with the largest shareholder, Kin Group Pty Ltd, also intending to support the proposal. The scheme meeting will be held virtually, and shareholders are encouraged to participate and vote.

The most recent analyst rating on (AU:TRS) stock is a Hold with a A$3.70 price target. To see the full list of analyst forecasts on Reject Shop Limited stock, see the AU:TRS Stock Forecast page.

Harvest Lane Asset Management Acquires Substantial Stake in Reject Shop Limited

Harvest Lane Asset Management Pty Ltd has become a substantial holder in Reject Shop Limited, acquiring a 5.01% voting power through ordinary fully paid shares. This acquisition positions Harvest Lane Asset Management as a significant stakeholder, potentially influencing the company’s strategic decisions and impacting its market dynamics.

The Reject Shop Issues New Shares to Key Management

The Reject Shop Limited has issued 75,000 new fully paid ordinary shares to its Key Management Personnel without disclosure under Part 6D.2 of the Corporations Act. This move, authorized by the Board, aligns with compliance requirements and indicates a strategic decision to potentially incentivize or reward its management team, which could impact the company’s operational dynamics and stakeholder interests.

The Reject Shop Limited Announces Quotation of New Securities

The Reject Shop Limited has announced the application for quotation of 75,000 ordinary fully paid securities on the Australian Securities Exchange (ASX). This move, involving securities issued under an employee incentive scheme, could potentially enhance the company’s market presence and provide additional value to its stakeholders.

Dollarama to Acquire The Reject Shop in Strategic Expansion Move

The Reject Shop Limited has entered into a binding Scheme Implementation Agreement with Dollarama Inc., under which Dollarama will acquire all outstanding shares of The Reject Shop at A$6.68 per share, a significant premium over recent trading prices. This acquisition, recommended by The Reject Shop’s Board and supported by its largest shareholder, Kin Group, is expected to enhance shareholder value and align with Dollarama’s strategic expansion into new markets, leveraging its expertise in value retailing to drive growth in Australia.