City Chic Collective's CCX's first half revenue and earnings were in-line with pre-guidance, however the start to the second half is well below consensus expectations, Morgan Stanley notes.

Earnings margins are well positioned to recover, the broker suggests, on improving gross margins, as inventory normalises, and tight opex control.

But sales continue to decline (-33% to start 2H) impacted by weak transaction volumes.

Equal-weight and 40c target retained. Industry view: In-Line.

Sector: Retailing.

Target price is $0.40.Current Price is $0.48. Difference: ($0.08) - (brackets indicate current price is over target). If CCX meets the Morgan Stanley target it will return approximately -20% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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