Analysts at Citi are somewhat bullish about Lovisa’s 12-month share price projection.
This is despite foot traffic among fashion and accessories retailers in the low-price jeweller’s biggest market – the United States – being relatively softer, and a global store rollout that is currently a smidge below forecasts.
In a note to investors earlier this month, Citi analysts think the 18 per cent slip in the Australian-born jewellery chain’s share price since August 29 (now at $35.21 as of writing) could swing back to its recent peak and has changed its stance from neutral to buy.
Heading towards Lovisa's annual general meeting on November 21, Citi wrote that its analysis suggests there is little risk that the retailer's global store rollout could disappoint, with upside risk over the rest of FY26 in Europe following the collapse of Claire’s – an American-born, global costume jewellery business.
A company has since bought up the Claire’s UK business, and only saved half of the 300 stores in the region.
Citi also noted that like-for-like sales should become easier to cycle over the first half of FY26. They believe store refurbishments by Lovisa and Claire’s North American situation – where up to 950 of its 1,500 stores in the region are expected to be saved following a similar acquisition in the country – could likely benefit.
“While Australian competition remains a key risk we are focused on, we think this issue is likely masked by the aforementioned tailwinds,” Citi analysts reported.
According to Citi’s analysis of Lovisa’s store footprint, the jeweller group had around 1,075 stores as of October 31. This includes the group’s Jewells retail brand in the United Kingdom. Calculated against Lovisa’s store footprint as of the end of FY25 (1,031), Citi thinks this implies around 2.5 net new stores per week.
“Extrapolating this rate of growth for 1H26 would take the company to 66 openings, a touch lower than VA Consensus at 70 stores,” Citi noted. “But given rollout timing is often lumpy, we don’t see this as enough to suggest there is downside risks to expectations.”
As an aside, Citi pointed out that Jewells’ store portfolio in the United Kingdom appears to have dropped, with the website showing only six stores, while Lovisa’s FY25 report noted there were seven stores by FY25 end.
“While it is unclear if there was a closure or not, the fact that there has potentially been no further rollout might suggest Jewells has had a challenging start,” Citi noted.
Ragtrader has reached out to Lovisa for comment on this.
As for foot traffic in the US, Citi analysts “observed” a softening in American apparel and accessories retailers, with weekly foot traffic growth averaging a 1.5 per cent decline in the first eight weeks of FY26, moderating to a 3.8 per cent fall in the following eight weeks compared to the prior corresponding period.
“That said, we see potential for Lovisa stores to benefit from the disruption at Claire’s, and the US represented 22 per cent of the store network as of FY25, and other countries could be outperforming,” Citi analysts noted.
For the first half, Citi is projecting mid-single-digit percentage growth in like-for-like sales for Lovisa.