Retailers reported first-half results that met expectations, but, their outlook remains weaker, with more companies revising down their earnings per share estimates for the year ahead, according to a March.6 note by Jarden Research.

Jarden notes that the downward revision is due mainly to higher depreciation and amortization, interest, and rent costs.

The main risk, aside from macroeconomic factors, is heightened competition, with several companies noting increased sector-specific rivalry and the weaker Australian dollar, Jarden said.

However, Jarden expects increased focus on mergers and acquisitions, capital expenditure, and market share expansion, citing stronger consumer spending, and increasing investor appetite for the sector.

Jarden remains positive on stocks such as Harvey Norman (ASX:HVN), Treasury Wine Estates (ASX:TWE), Flight Centre Travel Group (ASX:FLT), and Temple & Webster Group (ASX:TPW) due to strong growth potential and sector resilience.

The firm believes that Wesfarmers (ASX:WES) and Woolworths Group (ASX:WOW) are also considered promising, though they may face competition and execution risks in the near term.

In contrast, Jarden remains more cautious on Endeavour Group (ASX:EDV) and Super Retail Group (ASX:SUL), due to concerns around market dynamics and competition.