Is the Australian Retail Sector a good investment? – Andrew Baxter
With the demise of High Street names such as Dick Smith, Daryll Lea etc there has been much negative sentiment in the market questioning if the Australian Retail sector is a good investment. Last week, I was invited to attend an event hosted by Myer, their Spring Fashion launch, and things are looking very upbeat for this High Street stalwart. Just quietly, Jennifer Hawkins was also looking absolutely stunning, too!!
Where are the opportunities in the Australian Retail Sector? The two main players, Myer and David Jones have been through some very challenging times. Online carved a huge chunk out of their High Street businesses. Some have been looking for bargains, while others have looked for service with companies such as Net-A-Porter providing exceptional service in the online space (I am speaking first hand, as my wife seems to get deliveries most days!)
But is there light at the end of the tunnel? I believe that there may well be. One very supportive tailwind is the move in the Aussie/US Dollar, which has really removed any incentive to want to shop in the US. Back at 1.05, happy days, today, a 75.4 – no chance!! This more than most things, is a welcome reprieve, if not a stay of execution for some. Taking a look at Myer, the move up from a low, 12 months ago of 83cents to a recent high of $1.44 is testimony toward a sector that for the past few years has had few friends.