The Breville share price has at least 50% upside: top brokers

What’s happening with this global kitchen appliances company?

| More on:
A woman looks unsure as she ladles mixture into a pan surrounded by small appliances

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • The Breville share price has failed to fire up over recent months 
  • Shares in the global home kitchen appliances giant have lost 36% of their value in 2022
  • These three top brokers think there are plenty of reasons to buy Breville shares today 

The Breville Group Ltd (ASX: BRG) share price has been distinctly off the boil for months. It’s drifted down from a 52-week high of $33.61 in August 2021 to a 52-week low of $19.74 last week. Since the start of the year, shares in the global home kitchen appliances giant have lost 36% of their value.

Now, a trio of brokers are tipping the Breville share price to rise by at least 50% over the next year.

Can the Breville share price go to $30-plus in a year?

Morgans has given Breville an add rating with a share price target of $32. UBS agrees that Breville is a buy, but it has a more ambitious price target of $34. Macquarie is the most bullish, tipping the Breville share price to rise to $34.80.

Morgans says favourable industry tailwinds combined with Breville’s ongoing global expansion and heavy investment in research and development position the company for strong ongoing growth.

In a note to clients in May, Morgans said Breville was “positioned to deliver double-digit sales growth consistently over the next few years as it grows its market share, notably in geographies into which it has recently launched”.

Breville recently expanded into Norway, Finland, Denmark, and Sweden. This month, it hopes to start operations in South Korea, and in July it’s targeting Poland.

UBS reckons Breville can deliver ongoing double-digit earnings per share (EPS) growth over the next few years.

Macquarie retains its outperform rating and says Breville shares could go as high as $34.80 by this time next year.

Breville retains FY22 EBIT guidance

Macquarie interpreted a positive update from Italian small-appliance manufacturer De’Longhi SpA (FRA: DLN) in May as indicative of strength in home appliances retailing. This may bode well for Breville’s second-half results in FY22.

Breville gave a presentation at the Macquarie Investor Conference in Sydney on 3 May, where it reconfirmed its FY22 guidance. Breville said it expects earnings before interest and tax (EBIT) “to be consistent with the markets’ consensus forecast of ~$156 million”. The FY21 EBIT was $136.4 million.

What’s next for Breville?

Breville expects to complete its 100% acquisition of the Italian prosumer specialty coffee group LELIT next month. The company announced the $113 million euros purchase in March.

At the time, Breville Group CEO Jim Clayton said:

Both companies have a shared passion for using product innovation to improve our customers’ coffee experience at home, and we look forward to working alongside LELIT and its existing partners to further accelerate its growth and product innovation, while preserving the values that underpin its Italian identity.

The Breville share price slipped into the red early this afternoon and is trading at $20.44, down 0.39% at the time of writing.

Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Consumer Staples & Discretionary Shares

a happy woman wearing a white towel around her chest and another around her head laughs heartily while holding two slices of cucumber over her eyes as part of a beauty regime.
Consumer Staples & Discretionary Shares

Adore Beauty share price volatile following CEO resignation

Adore Beauty's CEO has called it time.

Read more »

A man looks sadly away from his computer screen as he holds a slice of pizza in his hand with an open pizza box in front of him on his desk.
Consumer Staples & Discretionary Shares

Is it a problem for shareholders that Italians don’t like Domino’s Pizza?

The pizza chain appears to have fizzled out in Italy.

Read more »

A group of people clink wine glasses in an outdoor, late afternoon setting to celebrate the rising Treasury Wine share price
Consumer Staples & Discretionary Shares

Treasury Wine share price up amid key China trademark win

Pop open the champagne bottle: the company just won a Chinese court case.

Read more »

a small girl sits with her hand holding up the side of her face as she looks down in a downcast manner as she drinks a glass of milk through a straw.
Consumer Staples & Discretionary Shares

Why is the A2 Milk share price spilling 8% today?

It's been a tough day for A2 Milk shareholders.

Read more »

A happy farmers sifts his fingers through grain, indicating a good crop and higher prices
Consumer Staples & Discretionary Shares

Why is the GrainCorp share price up 7% today?

The agribusiness has delivered good news to the market on Wednesday.

Read more »

A person with a round-mouthed expression clutches a device screen and looks shocked and surprised.
Consumer Staples & Discretionary Shares

iSelect share price explodes 75% on takeover news

The iSelect share price is sky high after the company revealed a takeover offer from the owner of www.comparethemarket.com.au.

Read more »

ASX retail ASX property war
Consumer Staples & Discretionary Shares

ASX 200 better buy: Wesfarmers or Woolworths?

Let's see how these ASX stalwarts stack up.

Read more »

A person sitting at a desk smiling and looking at a computer.
Consumer Staples & Discretionary Shares

2 ‘high quality’ ASX shares now going for a discount: Elvest

While financial forecasts this reporting season might be scary, here is a pair of stocks that might resist the coming…

Read more »