The Lovisa Holdings Ltd (ASX: LOV) share price looks like an excellent long-term opportunity after seeing the growth numbers from its FY26 result.
Lovisa is a global retailer of affordable jewellery across numerous countries worldwide. Impressively, it has stores on every continent and has an excellent outlook, in my view.
Lovisa may not be a tech stock, but few names on the ASX have such a wide geographic reach, with plenty of growth potential to come.
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Lots of store growth
The company continues to expand its global store network at an impressive pace, which is driving the overall business.
In FY26, the company reported a 10.2% year-over-year rise of its global store count to 1,136.
There was a net increase in stores over the year in Australia, Vietnam, South Africa, Zambia, the UK, Ireland, Spain, Germany, Belgium, the Netherlands, Switzerland, the USA, Canada and the Middle East and Africa franchise.
It's growing in a number of markets, and this is helping increase its presence and scale there.
The business actually closed 43 underperforming stores during the financial year, as well as relocating a further 12 stores. It's continuing to focus on store profitability – where landlords don't provide a profitable rent, it is willing to close that store.
Its FY26 comparable store sales grew by 2%, with an acceleration to 3% growth in the first eight weeks of FY27. I think this shows the business can continue to expand, while maintaining profitability with its existing stores.
Impressive financial growth
Compounding is a very powerful force, and if Lovisa continues growing its store count by around 10% (or more) a year, it's on course for a very profitable future.
In FY26, Lovisa's revenue grew 17.6%, gross profit rose 18.4%, operating profit (EBITDA) climbed 20.9%, and net profit after tax (NPAT) increased 10.7%. Net profit rose more slowly than EBITDA because of store rollout costs.
But I think the benefits of the store rollout will be reflected in the bottom line in the coming years.
I believe that Lovisa's net profit can continue growing at a double-digit compound annual growth rate (CAGR) in the coming years, which will help increase the value of Lovisa's shares.
I'm optimistic the company can grow strongly in Europe and North America in the coming years.
Rewarding cash payouts
The company is steadily increasing its payout to investors, which is helping boost cash returns, even before considering what could happen to the Lovisa share price over the next few years.
In the FY26 result, Lovisa hiked its annual dividend per share by 11.7% to 86 cents. That translates into a dividend yield of 3.1%, excluding any franking credits.
I expect the dividend will continue to grow alongside net profit in the coming years, so the yield for today's investors could grow significantly by the end of the decade.
