BWX – Citi rates the stock as Buy

US sales of cosmetics were down -40-62% in the four weeks to April 18, the broker notes, with weakness extending to suncream and shampoo, reflecting no one going out to shop. The US represents 49% of BWX sales.

But on the positive side, 20% of BWX sales are direct to consumer, including to the Amazon platform, the company has a greater proportion than peers of supermarket sales, and BWX also sells hand sanitiser. The other negative is potential supply chain disruption.  But looking beyond the virus, the broker retains Buy and a $4.20 target.

Sector: Household & Personal Products.

Target price is $4.20.Current Price is $3.46. Difference: $0.74 – (brackets indicate current price is over target). If BWX meets the Citi target it will return approximately 18% (excluding dividends, fees and charges – negative figures indicate an expected loss).

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