SwatchGroup: Oddo BHF lowers target price
(CercleFinance.com) - Oddo BHF maintains its 'underperform' rating on Swatch Group shares, with a price target lowered from CHF 202 to CHF 167, after the Group published H1 results that are well below expectations.
Sales came in at CHF 3,445m, down 14.3% y/y and 10.7% cc, with EBIT of
CHF 204m reflecting a margin of 5.9% (vs. 17.1% in H1 and 13.1% in H2 in 2023).
Our forecasts were sales of CHF 3,819m (+1% y/y cc) and EBIT of CHF 524m (margin 13.7%), the broker says.
Oddo BHF reports that the sharp decline in sales is due, the group says, to the sharp drop in sales of luxury watches in its largest market, Greater China (1/3 of sales in 2023), with a decline in activity of around 30% in H1.
The analyst believes that the downturn in China remains unavoidable in the 2nd half, but that it should be 'less severe than in H1'.
Against this backdrop, Oddo BHF has lowered its EBIT forecast for 2024 by 38% and for 2025 by 14%.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
The information and analyses published by Cercle Finance are intended solely as a decision-making aid for investors. Cercle Finance cannot be held responsible, directly or indirectly, for the use of information and analyses by readers. Uninformed investors are advised to consult a professional advisor before investing. This information does not constitute an invitation to sell or a solicitation to buy.
Sales came in at CHF 3,445m, down 14.3% y/y and 10.7% cc, with EBIT of
CHF 204m reflecting a margin of 5.9% (vs. 17.1% in H1 and 13.1% in H2 in 2023).
Our forecasts were sales of CHF 3,819m (+1% y/y cc) and EBIT of CHF 524m (margin 13.7%), the broker says.
Oddo BHF reports that the sharp decline in sales is due, the group says, to the sharp drop in sales of luxury watches in its largest market, Greater China (1/3 of sales in 2023), with a decline in activity of around 30% in H1.
The analyst believes that the downturn in China remains unavoidable in the 2nd half, but that it should be 'less severe than in H1'.
Against this backdrop, Oddo BHF has lowered its EBIT forecast for 2024 by 38% and for 2025 by 14%.
Copyright (c) 2024 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
The information and analyses published by Cercle Finance are intended solely as a decision-making aid for investors. Cercle Finance cannot be held responsible, directly or indirectly, for the use of information and analyses by readers. Uninformed investors are advised to consult a professional advisor before investing. This information does not constitute an invitation to sell or a solicitation to buy.