RBC Capital Markets has initiated coverage on JB Hi-Fi, assigning the electronics retailer a Sector Perform rating with a price target of $101 per share. JB Hi-Fi is a leading Australian retailer of consumer electronics and home appliances, operating both physical stores and an online platform. The company aims to provide a wide range of products at competitive prices.
According to RBC analyst Michael Toner, JB Hi-Fi is a “high-quality omnichannel retailer with industry-best cost base efficiency”. Toner noted that the company faces potential risks from increasing competition from online retailers such as Amazon and also limited benefits from AI-driven upgrades to boost product replacement cycles.
RBC highlighted JB Hi-Fi’s robust in-store presence, lean operating margins, and exposure to growing product categories like Windows 10 replacements and robotics as positive factors. However, the investment firm anticipates heightened online competition, with Amazon’s Australian market share projected to double within the next five years.
The $101 price target is based on a valuation that blends discounted cash flow (DCF) and sum-of-the-parts methodologies in equal measure.
