Shares in Myer jumped 3.8 per cent on Friday, pushing total gains for the past month to nearly 20 per cent, following a report of early fiscal 2026 sales momentum. According to Morningstar analyst Johannes Faul, the department store retailer remains undervalued. Myer reported pro forma group sales were up 3 per cent in the first 19 weeks of the year, compared with 2 per cent in the second half of fiscal 2025.
Faul is maintaining an 83-cent fair value estimate for Myer. Morningstar expects the underlying earnings before interest and taxes margin to expand 180 basis points to a long-term value of 5.6 per cent by the 2028 fiscal year.
“We believe the market expects profit margins to deteriorate. However, we anticipate Myer to successfully navigate the gradual structural decline in sales in-store by adjusting its footprint and shifting sales to its online channel. Online sales are up mid-single digits in the first 19 weeks,” Faul said. Myer is a department store retailer offering a wide range of apparel, cosmetics, homewares, and electrical goods. It operates both physical stores and an online platform.
Morningstar forecasts group sales to grow 3 per cent in fiscal 2026. Beyond that, Faul expects yearly sales growth to taper off to 1 per cent from fiscal 2027 onwards.
