Citi analysts observe Health and Happiness (H&H), the parent company of competitor Swisse, has flagged downside risks in China because of online platforms destocking, declining traffic and a weak domestic consumer.
The obvious parallel to draw is that all of these factors are likely to impact on China operations for Blackmores as well. Citi sees an additional negative for the latter through a weakening Chinese currency, the renminbi.
Plus Citi suggests competition remains intense in Blackmores' home market Australia. Sell rating retained with $71 target price.
Sector: Household & Personal Products.
Target price is $71.00.Current Price is $101.54. Difference: ($30.54) - (brackets indicate current price is over target). If BKL meets the Citi target it will return approximately -43% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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