Endeavour Group Ltd (ASX: EDV) shares have had a tough year.
Following another decline on Monday, this ASX 200 stock is now down by a disappointing 21% since this time last year.
Let's see if Bell Potter thinks this could be an opportunity to buy the Dan Murphy's owner's shares.
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What is the broker saying about this ASX 200 stock?
Bell Potter highlights that an update this week reveals that consumer sentiment is hitting the drinks giant's growth. It said:
Retail: Sales rose 2.9% YoY in 3Q26 (weeks 28-40) to $2,398m. HTD (weeks 28-43) growth was 0.7%. In the prior period, Easter fell in Week 42, outside of the third quarter. EDV noted consumer demand remains subdued outside of key events. Retail continued to gain share in a competitive market, the Easter holiday trading period delivered an increase in Retail sales compared to Easter in the previous year, with significant promotional activity.
Hotels: 3Q26 growth of 3.7% ($531m) maintained through the HTD period, despite momentum softening in March across food, bar and gaming due to cost-of-living pressures. Notwithstanding a record trading result on ANZAC Day, sales growth across March and April was 1.5% YoY, tracking below our full year estimate of 4.3%.
The broker also highlights that the ASX 200 stock is increasing its inventory cover for fast-moving lines in response to the Middle East conflict. This is expected to impact costs and margins. It adds:
EDV is increasing inventory cover for fast-moving lines by up to $400m to mitigate supply chain risks, funded via short-term debt. Elevated fuel and freight prices are expected to increase FY26 costs by $6-8m, primarily impacting Retail gross margins.
Should you buy Endeavour's shares?
Despite the tough trading conditions, Bell Potter believes this could be an ASX 200 stock to buy right now.
In response to the update, the broker has retained its buy rating with a trimmed price target of $3.85 (from $4.15). Based on its current share price of $3.29, this implies potential upside of 17% for investors over the next 12 months.
In addition, a fully franked 4.6% dividend yield is expected over the period. This boosts the total potential return beyond 21%.
Commenting on its buy recommendation, Bell Potter said:
We retain our Buy rating. Although the outlook for consumer spending has weakened due to the Middle East conflict and a worsening rate environment, we believe market expectations are low for the company's strategic refresh, leaving greater room for upside potential. We see opportunity for consensus upgrades: a strengthening of Dan Murphy's lowest-price perception; and cost-out opportunities.
