The Coles Group Ltd (ASX: COL) share price has started the week positively.
In afternoon trade, the supermarket giant's shares are defying the market weakness and rising 0.5% to $16.39.
Despite this, the Coles share price remains down a disappointing 15% over the last seven weeks.
Is the Coles share price weakness a buying opportunity for investors?
One leading broker that believes the Coles share price is trading at an attractive level is Morgans.
According to a recent note, the broker has retained its add rating with a $20.00 price target. This implies potential upside of 22% for investors over the next 12 months.
Another positive is that this potential return increases to 26% if you include the 65 cents per share fully franked dividend that Morgans is forecasting in FY 2023.
Why is the broker positive?
Morgans sees the Coles share price as a great option for investors for a couple of reasons. One is the company's strong market position. It explained:
The Australian supermarket sector is dominated by Woolworths and Coles with a combined market share of ~70%. This gives the two largest operators scale advantages over smaller rivals, strong bargaining power with suppliers, and financial capacity to invest for growth.
Another reason is the attractive level that its shares trade at given the company's defensive qualities. Morgans commented:
Our equally-blended (DCF, SOTP, PE) target price remains unchanged at $20.00. Trading on 21.0x FY23F PE and 3.9% yield we continue to see COL as offering good value with the company possessing defensive characteristics that should hold up relatively well in a weaker economic environment.
All in all, the broker appears to believe that this could make the supermarket giant one to consider if you're looking for new portfolio additions this month.