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Reject Shop Limited (AU:TRS)
ASX:TRS

Reject Shop Limited (TRS) AI Stock Analysis

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AU

Reject Shop Limited

(Sydney:TRS)

Rating:73Outperform
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 (TRS) vs. iShares MSCI Australia ETF (EWA)

Reject Shop Limited Business Overview & Revenue Model

Company DescriptionReject 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 MoneyReject 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
75
Positive
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
65
Positive
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
78
Positive
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
TTMJun 2024Jun 2023Jun 2022Jun 2021Jun 2020
Income StatementTotal Revenue
866.17M852.74M819.34M788.24M778.69M820.64M
Gross Profit
300.58M341.07M224.11M218.37M211.14M229.10M
EBIT
18.45M17.25M18.11M22.98M19.56M10.64M
EBITDA
79.42M125.44M129.64M125.67M128.53M122.69M
Net Income Common Stockholders
6.17M4.71M10.31M7.90M8.32M1.12M
Balance SheetCash, Cash Equivalents and Short-Term Investments
53.44M49.88M77.33M77.47M73.05M92.49M
Total Assets
527.17M490.74M502.39M483.73M401.81M424.13M
Total Debt
226.58M236.22M228.43M217.66M167.13M193.72M
Net Debt
173.15M186.34M151.09M140.20M94.08M101.23M
Total Liabilities
394.88M320.65M320.45M306.92M245.08M281.06M
Stockholders Equity
132.28M170.08M181.94M176.80M156.73M143.06M
Cash FlowFree Cash Flow
103.74M86.37M98.89M99.69M76.32M156.70M
Operating Cash Flow
119.44M102.11M111.02M116.14M87.09M167.38M
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 Price6.61
Price Trends
50DMA
6.54
Positive
100DMA
4.78
Positive
200DMA
3.86
Positive
Market Momentum
MACD
0.09
Positive
RSI
66.41
Neutral
STOCH
8.33
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

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
AUTRS
73
Outperform
€246.99M39.923.33%1.98%3.37%-25.24%
AUHVN
73
Outperform
$6.80B15.759.58%4.48%1.77%15.57%
AUSUL
73
Outperform
AU$3.21B14.1817.52%4.85%2.56%-13.62%
AUPMV
71
Outperform
AU$3.24B16.3514.01%6.57%-27.48%-27.96%
63
Neutral
$6.96B11.512.80%3.85%2.70%-24.43%
AUMYR
61
Neutral
€1.19B24.738.55%5.59%-2.43%-49.64%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
AU:TRS
Reject Shop Limited
6.61
3.37
104.01%
AU:HVN
Harvey Norman Holdings Ltd
5.48
1.24
29.34%
AU:MYR
Myer Holdings Limited
0.69
0.07
11.47%
AU:SUL
Super Retail Group Limited
14.08
1.79
14.56%
AU:PMV
Premier Investments Limited
20.38
-0.78
-3.69%

Reject Shop Limited Corporate Events

Harvest Lane Increases Stake in Reject Shop Limited
May 28, 2025

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
May 21, 2025

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
May 20, 2025

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
May 19, 2025

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
May 16, 2025

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
May 16, 2025

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
Apr 16, 2025

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
Mar 31, 2025

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
Mar 28, 2025

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
Mar 27, 2025

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.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.