Bell Potter names the best ASX retail stocks to buy

If you're looking for some retail sector exposure in 2026, then it could be worth considering the ASX stocks named below.

That's because Bell Potter has just named them as its top picks in the sector. Here's what it is recommending to clients:

Adore Beauty Group Ltd (ASX: ABY)

The beauty retailer has caught the eye of Bell Potter due to its strong rollout and private label expansion, which is supporting margin improvements. Overall, it believes this leaves the ASX retail stock well-placed in the Australian beauty category. It said:

Key drivers for business growth are its continued store-rollout targeting a network of 25+ stores, along with its private label brands and high-margin retail media arm contributing to margin expansion and thus a strong earnings trajectory. We view ABY as well positioned to take advantage of the high performing beauty category within the Australian market.

Bell Potter has a buy rating and $1.25 price target on its shares.

Harvey Norman Holdings Ltd (ASX: HVN)

This retail giant's shares could be a buy according to Bell Potter despite rising strongly this year. It believes Harvey Norman's shares are undervalued based on its positive growth outlook. The broker explains:

Despite the strong re-rate in the name, HVN trades at ~2.0x market capitalisation to freehold property value as Australia's single largest owner in large format retail with a global portfolio surpassing $4.5b and collectively owning ~40% of their stores (franchised in Australia and company operated offshore). This sees our view that of the 1-year forward ~19x P/E multiple as justified considering the multiple catalysts near/mid-term.

Bell Potter currently has a buy rating and $8.30 price target on its shares.

Universal Store Holdings Ltd (ASX: UNI)

Finally, at just 18x estimated FY 2026 earnings, Bell Potter thinks that youth fashion retailer Universal Store could be an ASX retail stock to buy.

It believes the company is well-placed for growth given its store expansion plans and increasing private label penetration. The broker said:

At ~18x FY26e P/E (BPe), we see UNI trading at a discount to the ASX300 peer group and see the multiple justified by the distinctive growth traits supporting consistent outperformance in a challenging broader category, longer term opportunity with three brands, organic gross margin expansion via private label product penetration (currently ~55%) and management execution. We continue to see the youth customer prioritising on-trend streetwear and expect UNI to benefit with their leading position.

Bell Potter has a buy rating and $10.50 price target on its shares.

The post Bell Potter names the best ASX retail stocks to buy appeared first on The Motley Fool Australia.

Motley Fool contributor James Mickleboro has positions in Universal Store. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended Adore Beauty Group. The Motley Fool Australia has positions in and has recommended Harvey Norman. The Motley Fool Australia has recommended Adore Beauty Group and Universal Store. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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