** Jefferies initiates coverage on online homewares and furniture (H&F) retailer Temple & Webster TPW.AX with "underperform" rating and A$17.0 PT

** Brokerage says TPW had a first-mover advantage in online furniture space but flags maintaining market leadership will be a challenge to due to intensifying competition

** Says valuation metrics appears to be demanding with TPW's shares trading 29% above Jefferies PT

** Jefferies is "cautious on TPW's ability to penetrate Trade and Home Improvement, given both may require a shift in the business model"

** However, Jefferies sees H&F sales to accelerate due to the rate-cut cycle in Australia and strong consumer confidence at a 32-month high

** Analysts on average rate the stock "buy"; their median PT is A$19.0 – LSEG data

** Stock up nearly 63% pct this year

(Reporting by John Biju in Bengaluru, editing by Deepa Babington)

((John.Biju@thomsonreuters.com;))