If you are searching for a combination of major upside and an above-average dividend yield, then look no further than the ASX 200 stock in this article.
That's because the team at Bell Potter believes its shares can deliver both over the next 12 months.
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Which ASX 200 stock?
The stock that Bell Potter is bullish on right now is Harvey Norman Holdings Ltd (ASX: HVN).
It is of course one of Australia's largest retailers with a growing network of stores selling electronic and household goods across the globe.
Bell Potter has been looking at its recent half-year result and while it was a touch softer than expected, it remains positive. It said:
Harvey Norman (HVN)'s 1H26 result back in February saw some minor misses, however with aggregate system sales +7% and the least variance in the Australian Franchising division supported by strong franchising operations margins.
The Australian business saw comparable sales growth easing towards the ~1% level (as per BPe) in the last 6 weeks of 1H (21-Nov to 31-Dec) as HVN cycled ~9% comps. The month of Jan in 2H26 started at a slightly better 3.6% comparable sales growth in Australia (cycling +2.1%), however tougher comps 2H to be cycled in Feb-Jun. The Home, Lifestyle and Technology categories have remained robust during 1H26.
Major upside and a big dividend yield
According to the note, the broker has retained its buy rating with a reduced price target of $6.70 (from $8.30).
Based on its current share price of $4.87, this implies potential upside of 38% for investors over the next 12 months.
In addition, it is expecting the ASX 200 stock to provide investors with a generous 6.1% fully franked dividend yield over the period. This boosts the total potential return to over 44%.
Bell Potter thinks its shares are being undervalued by the market at just 13x forward earnings. Commenting on its buy recommendation, Bell Potter said:
While our preference skews to category specialists with balance sheet strength, we see HVN's well balanced geographical diversification somewhat offsetting the multi-category risks. Following the sharp sell-off in the name since Oct-25, HVN's 1-year forward P/E of ~13x (as per BPe) appears attractive considering the new store driven growth in international retailing (UK, Malaysia, Croatia), refit program in Australia and opportunities to grow their real estate portfolio as Australia's single largest owner in large format retail with a global portfolio of ~$4.6b.
