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Analysts Forecast Bunnings Slowdown

Hardware giant, Bunnings, is forecast to post a decline in revenue and sales from Q4, driven by a housing market slump and unfavourable weather.

According to The AustralianMorgan Stanley analysts warn the market has underestimated the housing market’s effect on Bunnings’ bottom line.

As previously reported, the Wesfarmers-owned retailer is tipped to contribute over 50% of group earnings following Coles’ demerger.

Coles will soon list on the ASX as an independent entity, and analysts warn increased focus on Bunnings could lead to a de-rating.

In an investors note, Morgan Stanley analysts assert declining auction clearance rates and continued housing market slump will affect Bunnings’ ANZ fiscal 2019 performance.

Consequently, analysts warn the market may be overly optimistic about Bunnings’ valuation.

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