What are Macquarie's top 3 ASX stock picks in the consumer sector?

These are the brokers top picks from this side of the market.

Investors with room for some new portfolio additions, might want to check out the ASX stock picks listed below.

That's because Macquarie Group Ltd (ASX: MQG) has named them as its top three picks in the consumer sector.

Let's see what the broker is recommending to clients right now:

Happy couple doing online shopping.

Image source: Getty Images

Nick Scali Limited (ASX: NCK)

The broker's top ASX stock pick in the consumer sector is furniture retailer Nick Scali.

Macquarie likes Nick Scali due to its attractive valuation and strong earnings growth outlook. The latter is expected to be driven by improvements in gross margins both in Australia and the UK. It explains:

NCK have guided to a further 8 Fabb Furniture stores to be converted to Nick Scali branded stores in the UK. This is expected to cause increased short term losses in 2H25 compared to 1H25. […]  We forecast 14% EPS CAGR between FY25-28e, driven by an expected recovery in ANZ GM%, an improved UK GM% and strong sales growth in the UK following store refurbishments. While we expect 2H25e to be impacted by losses in the UK, we see upside to VA consensus on GM% in the UK. Potential for further store openings in the UK would provide upside to current forecasts.

Macquarie currently has an outperform rating and $19.90 price target on its shares.

Universal Store Holdings Ltd (ASX: UNI)

Second on the list is youth fashion retailer Universal Store. Macquarie has named it as a top ASX stock pick due to its strong earnings growth outlook.

This is being underpinned by new store openings and further market share gains. The broker explains:

We forecast ~9% EPS CAGR between FY25-28e, driven largely by top-line growth. We expect sales to be supported by ongoing store openings, and store re-locations into key locations. We expect further market share gains from ongoing issues with key competitors. We expect modest EBIT margin expansion from FY25e, further supporting EPS growth.

The broker currently has an outperform rating and $9.80 price target on the company's shares.

Lovisa Holdings Ltd (ASX: LOV)

Finally, in third place is fashion jewellery retailer Lovisa.

Macquarie believes it is well-placed to deliver earnings growth in the high teens over the coming years. This is expected to be driven by a combination of new store openings and modest like for like sales growth. It explains:

We forecast ~19% EBIT CAGR between FY25-28e, driven largely by top-line growth (revenue CAGR of ~13%) with further support expected from EBIT margin expansion. We expect sales to be supported by ongoing store rollout with modest LFL sales growth forecasted. We expect EBIT margin expansion to be largely supported by lower STI/LTI payments (new CEO incentives).

Macquarie currently has an outperform rating and $33.40 price target on Lovisa's shares.

Motley Fool contributor James Mickleboro has positions in Lovisa and Universal Store. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Lovisa and Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended Lovisa and Nick Scali. 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

two women and a man eating pizza at a party
Consumer Staples & Discretionary Shares

Domino's Pizza Enterprises vs Guzman y Gomez: Which fast food stock offers better value?

Comparing Domino's Pizza and Guzman y Gomez shares on valuation, yield, franking and recent momentum to spot which ASX fast…

Read more »

A woman wearing a black and white striped t-shirt looks to the sky with her hand to her chin, contemplating buying ASX shares.
Consumer Staples & Discretionary Shares

CAR Group vs Seek: Which ASX 200 stock is better value?

CAR Group and Seek both lead online classifieds, but which ASX share offers better value for Aussie investors right now?

Read more »

A man in a business suit rides a graphic image of an arrow that is rebounding on a graph.
Consumer Staples & Discretionary Shares

IDP Education vs G8 Education: Which battered ASX stock could rebound?

Both IDP Education and G8 Education have been smashed—here’s why I think one offers the more compelling rebound opportunity.

Read more »

Man holding out Australian dollar notes, symbolising dividends.
Consumer Staples & Discretionary Shares

If I buy $6,000 of Coles shares, how much dividend income will I receive?

Coles can be the source of strong dividend income.

Read more »

Two happy woman on a couch looking at a tablet.
Consumer Staples & Discretionary Shares

Adairs vs Temple & Webster: Which ASX retail stock wins for October?

Adairs and Temple & Webster both look beaten up, but only one stacks up as the stronger retail buy for…

Read more »

Woman holding several shopping bags.
Consumer Staples & Discretionary Shares

Lovisa vs Baby Bunting: Which ASX retailer is the better buy today?

Lovisa and Baby Bunting face off: which ASX consumer discretionary share deserves a place in your portfolio?

Read more »

Cropped shot of a mature businessman brainstorming and setting financial goals with notes on a glass wall.
Consumer Staples & Discretionary Shares

Tabcorp vs The Lottery Corporation: Which ASX gaming share comes out on top?

Breaking down Tabcorp vs The Lottery Corporation: which ASX gaming stock looks most attractive on dividends, value, and earnings this…

Read more »

Frustrated stock trader screaming while looking at mobile phone, symbolising a falling share price.
Consumer Staples & Discretionary Shares

This ASX retail stock is sliding today after a surprise CEO exit

A major shake up has investors selling this ASX stock.

Read more »