As the RBA looks to quell inflation with rate rises, conventional wisdom suggests Australian households will have less to spend on shiny new laptops, TVs and other consumer discretionary gear. Typically, that would spell trouble for discretionary companies on the ASX. Not in today’s topsy-turvy market.

Switzer Report’s Paul Rickard joined this week’s Switzer Investing TV to explain why JB Hi-Fi is a standout example of a company bucking the trend.

Despite falling from around $120 a share in October to $78 at the start of this week’s trading, Rickard says JB Hi-Fi remains worth a look.

And the latest numbers back that up.

The retailer reported HY26 total sales of $6.10 billion, up 7.3 per cent, with EBIT rising 8.1 per cent to $454.0 million and net profit after tax up 7.1 per cent to $305.8 million. Earnings per share rose 7.1 per cent to 279.7 cents and the interim dividend increased 23.5 per cent to 210 cents per share, reflecting a higher payout ratio of 75 per cent of net profit.

So what gives Rickard confidence that JB Hi-Fi can maintain that performance in a sticky inflation environment?

As always, he says, the detail matters. A store-by-store analysis shows the business is holding up.

“Comparable store sales are the really important number. These are stores that were open 12 months ago and are still open now. How are they trading relative to how they traded 12 months ago?” he said.

“Sales over the half year, comparable store sales — in other words, not sales from adding new stores — were up over 5 per cent across all their divisions, which is pretty good.”

Rickard cautioned that January trading was softer than the market expected.

“The market’s initial reaction was they gave some January sales numbers which were a bit down. Comparable store sales for one month were only up 2.6 per cent,” he said.

“You’ve got to be a bit careful reading that. January is a funny month. There are so many seasonal issues at play.”

Even so, he argues the stock still deserves consideration from income-focused investors.

“It is as blue chip as you want to come in terms of retail. It’s the best retailer in Australia by question. It’s done it year in, year out,” he said.

“Discretionary, with talk of higher interest rates, is not going to be flavour of the month. But this is a stock you can put away and rely on the dividend.”

Watch the full episode here.