This report is an updated version of the report published on 30 January 2026 at 2:51 PM AEDT. 

Lovisa Holdings Limited (ASX: LOV) 

Company Overview: Lovisa Holdings Limited (ASX: LOV) is an Australia-based specialist fast fashion jewelry retailer. The Company and its subsidiaries are primarily involved in the retail sale of fashion jewelry and accessories. The Company is also focused on designing, developing, sourcing, and merchandising all its branded products. 

Recommendation Rationale – AUD 31.525

• Technical Standpoint: LOV is now trading around Resistance 1 level recommended on 13 January 2026, while RSI (~57.72 level) is hovering in the mid-to-high 50s, not in strong bullish territory. Importantly, during the last major rally the RSI reached overbought levels, but the current recovery shows a lower RSI peak. That negative momentum divergence signals fading strength and increases the risk of another rollover.
• Competitive & Industry Risks: Lovisa operates in specialty retail fashion jewelry — a consumer discretionary category that is sensitive to changing tastes, economic slowdowns, and competition from online retailers. Retailers with physical store footprints can struggle if consumer spending shifts. While LOV has been growing internationally, such expansion also brings higher operating costs and risks.
• Underlying Risk: Most of the topline growth is being driven by opening 162 new stores rather than strong productivity from existing stores. Heavy reliance on new store rollouts makes growth more capital intensive and execution dependent. If new store productivity disappoints, overall growth could slow quickly.
• Dividend Decline: The final dividend was cut from 37.0 cps in FY24 to 27.0 cps in FY25. Even if partly a capital management decision, a lower dividend despite higher profit can be read as a sign that more cash is being retained to fund expansion, not returned to shareholders. That can dilute the near-term income appeal of the stock.
• Inflation Squeezes Consumer Wallets: Australia’s headline CPI inflation rose to 3.8% year-on-year in Dec 2025 (up from 3.4%), and the core trimmed mean also lifted — both above the RBA’s 2–3% target range. Food, services, rents, electricity and other everyday costs are rising materially. When essentials take up a larger share of the household budget, discretionary categories (fashion jewelry) often get cut back. That dynamic can translate into softer same-store sales.

Daily Price Chart

 (Daily Technical Chart; Source: REFINITIV)

Valuation Methodology: Price/Cash Flow Approach (Illustrative)

The stock might trade at a slight premium to its peers given the 14.2 YoY increase in FY25 revenue, 10.9% YoY increase in FY25 operating cash flow, stable underlying demand, among others. 

For conducting the valuation, following peers have been considered - Nick Scali Ltd (ASX: NCK), IDP Education Ltd (ASX: IEL), and Eagers Automotive Ltd (ASX: APE).

Given the stock is trading around its R1 level, recent CPI data, and risks associated, it is prudent to sell the stock at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current market price of AUD 31.525, as of 30 January 2026, at 2:30 PM AEDT.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical issues prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 30 January 2026. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Kalkine reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 25-30 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.

Note 5: Dividend Yield may vary as per the stock price movement. 

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.