Myer’s Not Out of Fashion Yet, Relief Rally Lifts Shares 10%

Relief Rally at Myer

Myer (ASX:MYR) has had a tough year, falling 62%, but investor sentiment showed early signs of recovery today with shares up 10% following the company’s board presentation. The trading update offered a glimmer of momentum heading into FY26, with total sales for the first 19 weeks of 1H26 up 3 percent, supported by stronger demand in key categories such as homewares, womenswear, and concessions.

Despite a challenging retail environment, FY25 sales of A$3.67 billion were resilient, while online sales reached A$743 million, accounting for roughly 20% of total revenue. Profitability took the biggest hit, with NPAT down 30 percent, reflecting the ongoing cost pressures facing discretionary retailers.

From our view, today’s rebound feels less about a turnaround and more about relief that the numbers weren’t worse. The early FY26 trends are encouraging, but the market will want to see margin stabilisation and inventory discipline before confidence fully returns. Still, at these levels, MYR looks interesting for contrarian investors who believe the cycle could slowly turn.

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Myer’s Loyalty Push Shows Promise

Myer’s management team has been clear about its focus on two key areas, customers and loyalty. The company recently relaunched its MYER one program, which now has 4.9 million active members and partnerships with major brands such as CommBank and Velocity. The tag rate across retail sits above 80%, reflecting strong engagement. Integration of its apparel brands is progressing well, with 22 new beauty brands and 14 fashion labels added, while Myer Exclusive Brands are set to launch in 2H26. The Sydney City store renewal is underway, and the company’s online marketplace is transitioning to the Mirakl platform, which is already delivering growing sales.

With these initiatives in motion, research suggests Myer continues to navigate a difficult retail environment with a degree of resilience. The company’s focus on cost discipline and digital innovation provides a path toward gradual recovery. Early FY26 sales growth supports this trend, but persistent inflation and cautious consumer spending remain key headwinds that could limit the pace of improvement. Overall, Myer appears to be stabilising, yet sustained execution will be crucial to turning this early momentum into a meaningful turnaround.

Margin Recovery Is Key

Analyst sentiment toward Myer ASX: MYR remains mixed but cautiously optimistic. Two analysts currently maintain a hold rating, while another two have a buy recommendation with a price target of around A$0.69, implying meaningful upside from current levels. On relative valuation metrics, Myer appears undervalued; its price-to-sales multiple sits at 0.19x and its EV/EBITDA multiple around 5.7x, both below industry averages.

Using a PEG-style lens that adjusts for underlying earnings, Myer’s implied PEG ratio sits near 0.3, based on analyst forecasts for EPS growth of more than 60 percent per year in the short term. This suggests potential undervaluation if that growth materialises, though it is worth noting that projections can vary widely in a volatile retail landscape.

In simple terms, if management can execute consistently and prove that the business model is more resilient than the market currently expects, the stock has room for a re-rating. Execution and margin recovery will ultimately determine whether today’s value gap represents opportunity or a value trap.