Harvey Norman Holdings Ltd (ASX: HVN) shares have been on fire over the past 12 months.
During the time, the ASX 200 stock has risen by a massive 60%.
As a comparison, the S&P/ASX 200 Index (ASX: XJO) has climbed a solid 10%.
The good news for investors is that it may not be too late to buy this retail giant's shares. Let's find out why.
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High-flying ASX 200 stock tipped to keep rising
According to a note out of Bell Potter, its analysts remain very bullish on the retailer and see plenty of value left on the table for investors.
Commenting on its FY 2025 results and strong start to the new financial year, the broker said:
Harvey Norman (HVN)'s FY25 saw beats across all three divisions, with the Australian Franchising division seeing the fastest growth to drive the largest beat. The month of July in FY26 has started at a very strong level of +9.9% in overall aggregate sales with Australia franchisee headline comparable sales growth at +6.4% (+3.3% in the pcp) and all other regions (led by Ireland and New Zealand) tracking at positive comps driven by Home & Lifestyle and Mobile, Computer Technology & Electrical categories.
And despite the ASX 200 stock cycling strong Australian sales growth in the prior corresponding period, it feels that the AI driven upgrade and replacement cycle could help it continue its growth. It explains:
We factor in the beats across divisions and the pace of entry into FY26 especially from the Australian business. HVN would be cycling +8.6% comps in Nov/Dec vs the current +3.3% within the Australian franchising division, however we see sufficient catalysts from the AI driven upgrade/replacement cycle in Computers/Consumer Electronics and in other categories due to recover such as Furniture & Bedding for the seasonal 2Q26e.
Major valuation upgrade
In light of the above, Bell Potter has retained its buy rating on the ASX 200 stock with a vastly improved price target of $8.30 (from $6.00).
Based on its current share price of $7.45, this implies potential upside of approximately 11.5% over the next 12 months.
In addition, Bell Potter expects a fully franked dividend of 30.9 cents per share in FY 2026, which equates to an attractive 4.1% dividend yield.
This means that a total potential return of almost 16% is on the cards based on the broker's recommendation.
Overall, despite re-rating strongly this year, the broker believes that Harvey Norman's shares deserve to trade at a premium and can continue to rise. It concludes:
Despite the strong re-rate in the name, HVN trades at ~2.0x market capitalisation to freehold property value as Australia's single largest owner in large format retail with a global portfolio surpassing $4.5b and collectively owning ~40% of their stores (franchised in Australia and company operated offshore). This sees our view that of the 1-year forward ~20x P/E multiple as justified considering the multiple catalysts near/mid-term.
