I'm bullish on this FTSE 100 stock with a 21% expected return over 12 months

Analysts have a 21% 12-month price target on FTSE 100 company Group of Frasers (LSE:FRAS). I'm also interested in the business for its stellar rating, strong market position, and recession resistance.

The Frasers continue to improve

The company is a leading UK-based retailer that operates across sports, premium lifestyle, and luxury stores. Some of its most popular subsidiaries include Sports Direct, Flannels and Jack Wills.

Management is actively pursuing international expansion, especially in Europe. I expect this will help deliver strong future growth.

Also, it focuses on improving the retail experience by using store concepts enhanced with digital capabilities. In addition, it launched Frasers Plus, a financial services product offering credit facilities and loyalty rewards. Both of these areas are likely to help strengthen customer relationships.

High growth but great value

The company has experienced exponential growth rates. Over the past 10 years, the average income growth rate has been 13%. However, as it stands, it is currently around 22%.

For comparison, its price-to-sales (P/S) ratio over the past 10 years was 0.67. That's exactly the same as its current rating. Also, it shows that the company is currently selling only 67% of its total revenue. That is a very good price.

Risk assessment

Frasers competes with other formidable businesses in their sector, including JD Sports Fashion and Decathlon. It also competes with online marketplaces, including similar ones eBay again Amazonchallenging Frasers traditional marketing focus.

This opens up market risk, and I believe a heavy digital strategy from Frasers management is smart. As I said above, it has shown signs of this, which is good to see.

However, there is also currently a critical cost of living situation. This often hits businesses that rely heavily on purchases from non-wealthy consumers. The Frasers fall into this category, so I know there may be slower growth in the future.

Fortunately, its focus is on high-end consumers and this somewhat protects it from economic downturns. That's because as prices rise, affluent customers can continue to buy less essential items than those on a budget.

The long-term benefits I expect

While the near-term return of 21% expected by analysts is attractive, it is worth remembering that a large part of this is due to the fact that the stock is currently likely to be undervalued.

If the market begins to value the company on merit going forward, its stock price gains will depend heavily on its growth rates. The current consensus from analysts is that the company will deliver 5.3% annualized revenue growth over the next three years. This is very low, so I expect strong near-term growth based on calculations and strong, slower long-term growth following this.

Frasers is still a good short-term buy, but like a Fool, I only look for long-term investments. This doesn't look like much growth on the horizon for many years, and it's not paying off right now. So, I'm sitting on the sidelines of this company for now.