Morningstar | Myer may shrink to greatness by rationalising its store footprint and product range.
For investors seeking exposure to the Australian department store sector, no-moat-rated Myer provides the greatest leverage: All of its operating earnings are generated by department stores. However, times are tough for Australian department stores, and this pressure is unlikely to let up soon. We expect Amazon to prove similarly disruptive to incumbent retailers in Australia as in the U.S., compounded by a continued decline in the sector's relevance to consumers as they shift their spending to entertainment, leisure, and specialty shops.Myer is undeniably in a hard spot, but management is following a clear strategy to cope with the challenges facing the sector. Key strategic targets include a more concentrated physical footprint, greater cost efficiencies, productivity gains, and investment in online capabilities to drive sales and profitability.Myer Holdings is a department store group, with more than 60 stores across Australia. Co. also owns Australian womenswear designer brand, sass & bide.
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Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
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