According to Morgan Stanley, strong cost control was behind in-line earnings (EBITDA) for City Chic Collective in the 1H, though sales were -6% adrift of the consensus estimate.

Second quarter gross margins were higher than Q1 and remain on track to return to historical levels, believe the analysts. 

Management is contemplating selling the North American business, which accounts for around 50% of group revenue, notes the broker.

Equal-weight rating. Target 40 cents. Industry View: In-Line.

Sector: Retailing.

Target price is $0.40.Current Price is $0.55. Difference: ($0.15) - (brackets indicate current price is over target). If CCX meets the Morgan Stanley target it will return approximately -37% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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