Harvey Norman Holdings Ltd (ASX: HVN) shares have flown more than 50% higher in 2025.
This is partly thanks to continued strong aggregated sales in FY 2026.
Aggregated sales for the period 1 July 2025 to 20 November, increased by 9.1% over the prior corresponding period.
On a comparable store basis, its aggregated sales increased by 8.1% year-on-year.
As many investors are aware, the company is a leading Australian-based retailer selling electrical, computer, furniture, and entertainment goods.
Perhaps lesser known is the company also owns a considerable portfolio of properties, many housing its retail stores in Australia and New Zealand, as well as some overseas property holdings.
After strong returns this year, particularly in FY26, is there still upside for Harvey Norman shares?
Here is the latest guidance from Macquarie on Harvey Norman shares.
Momentum continues for Harvey Norman shares
Citing proprietary High Frequency Consumer Data, Macquarie recently noted that the electronics and furniture categories are growing.
The broker said consumer electronics has continued its momentum, with recent key product releases and laptop/small appliance replacements driving growth.
In furniture, management noted tailwinds from replacements also being realised from the COVID-period.
However, comparable sales growth has been broadly unchanged between the Jul-25 trading update and the year-to-date.
The report also indicated growth in three key international markets.
Since July, there has been sequential improvement in the sales trajectory across New Zealand, Malaysia and the UK.
According to the report, this bodes positively for earnings and potential network expansions.
Real estate arm faces headwinds
Despite growth in the Australian and international markets for electronics and furniture, the team at Macquarie sees increasing challenges for Harvey Norman for its real estate portfolio.
Macquarie said a meaningful improvement in detached housing creation is key to seeing additional momentum in the AU business, with recent inflation prints tempering the outlook for potential cuts.
Our house view is the RBA cutting cycle has finished. While replacements are supporting current comps, we see the potential for further upside surprises as more limited.
Neutral view
Based on this guidance, Macquarie has downgraded its view on Harvey Norman shares to a neutral rating.
Despite a more subdued housing outlook, HVN is performing well, with tech and furniture exposure benefiting from replacements. However, with the stock having re-rated ~30% on a P/E basis and share price rising >50% over last 12-months, we see risk/reward as more balanced.
Yesterday, Harvey Norman shares closed at $7.14.
Macquarie has a price target of $7.60.
This indicates modest upside of 6.44%.
