Baby Bunting Group (ASX:BBN) turnaround is going according to plan, benefiting from improved sales trends and higher margins due to its recently implemented strategies, despite a challenging consumer environment, Citi said, according to multiple media reports released Thursday.
On Tuesday, the company reported group pro forma unaudited net profit after tax of AU$4.8 million in the first half of fiscal 2025, rising 37% from AU$3.5 million in the same period a year earlier.
The retailer also reported comparable store sales growth of 2.2% for the period. Its comparable store sales growth for the year to Oct. 13, 2024, was 0.6%.
Citi analyst Sam Teager, sees potential for growth from store refurbishments and new store formats.
Teager also expects gross margins to keep improving due to the delayed impact of supplier renegotiations, stock turns, and annualization benefits.
Citai upgraded Baby Bunting to buy from neutral and increased its price target to AU$2.01.
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