New Morningstar Analyst Report for Harvey Norman Holdings Ltd.

Harvey Norman predominately sells commoditised branded electronics, such as televisions and computers, appliances and furniture. Headwinds continue to mount, as Internet research and price comparisons threaten the dominance of Harvey Norman and its brick-and-mortar peers. The strengthening Australian dollar compounds the matter because now the lowest prices are invariably the large Internet retail suppliers based in the U.S. The domestic retailer is increasingly becoming the shop window for cheaper online channels. For this reason, we do not believe Harvey Norman to have a sustainable competitive advantage, leading to a no moat rating.