Endeavour Group's 1H results were in line with Morgan Stanley's forecasts, but the trading update -showing sales were impacted by a slower January- was shy of consensus expectations.
A weighting of opex for One Endeavour to the 2H resulted in a 2% beat over consensus for earnings (EBIT) in the 1H, explains the broker.
The group realised $53m of cost savings in the 1H via the EndeavourGO program, helping to deliver a gross margin beat.
Management's FY24 interest expense guidance of $300-310m exceeded the consensus estimate for $295m.
Morgan Stanley's $5.80 target and Equal-weight rating are maintained. Industry view is In-Line.
Sector: Food & Staples Retailing.
Target price is $5.80.Current Price is $5.25. Difference: $0.55 - (brackets indicate current price is over target). If EDV meets the Morgan Stanley target it will return approximately 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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