Coles shares surge on analyst upgrade after earnings miss. Australian stockbroker Bell Potter assigned a Buy rating to Coles Ltd, sending the stock up over 3.25% on Monday following last week's sell-off. The retailer missed revenue growth expectations with 2.5% growth versus analyst forecasts of 3%, triggering an 8% decline on Friday. However, Bell Potter noted that profits exceeded expectations and set a price target of $22.35 per share compared to Friday's close of $20.56. The upgrade is supported by an expected fully franked dividend yield of 3.6%, implying potential upside of approximately 12%. This move reflects a broader shift toward defensive consumer staples stocks as investors navigate geopolitical tensions and tech sector weakness. Woolworths has outperformed Coles significantly, though both benefited from Monday's sector rotation into dividend-paying assets.
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