SkinKandy (ASX:SK1) is in a position to grow earnings per share by 17% per year between fiscal year 2027 and fiscal year 2030, with upside potential of 19% to 28% in the medium term from better margins, Jarden said in a Thursday note.
The company, which made its trading debut on the Australian bourse in May, is a jewelry concept that "ticks many boxes" via cookie-cutter rollout, underserviced market, and fast store paybacks of 14 months, the investment firm said.
Jarden's store mapping analysis indicates SkinKandy has scope for 161 to 202 stores across Australia and New Zealand, compared with a current count of 109 and slightly below the company's target of 180 to 210 units.
Additionally, SkinKandy's needle piercing prices are 13% to 36% lower than competitors', providing some upside for sales growth from price increases, Jarden said. It added that the company's like-for-like sales growth forecast of around 6% for the second half of fiscal year 2026 appears to be conservative.
Meanwhile, a proprietary survey of 382 shoppers in Australia shows a favorable customer view of the company, the equity research firm said.
It started coverage on SkinKandy with an overweight rating and a AU$2.90 target price.