Swatch: Credit Suisse cuts target price
(CercleFinance.com) - Credit Suisse has cut its target price for the Roche share from 270 Swiss francs to 250 Swiss francs, while confirming a Neutral rating.
"We cut our FY20e and FY21e operating profit forecasts by 25% and 3% respectively. We now forecast SFr733m operating profit in FY20e," the broker says.
Analysts say that this largely reflects the disruption caused by COVID-19, as well as the strength of the Swiss franc.
Credit Suisse also says that HK/China and Chinese consumers respectively represented 35% and 50% of FY 2019 sales.
"First, watch exports and consumer demand in Asia have decoupled since 3Q19 leading to inventory turns in the trade deteriorating to >260 days in 4Q19 globally against 180 days on normalized levels," Crédit Suisse explains.
"We forecast a 10% drop in 1H organic sales. This brings our operating margin estimates to 9.5% in FY20e and 12.1% in FY21e, down from 12.4% in FY19," analysts add.
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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.
"We cut our FY20e and FY21e operating profit forecasts by 25% and 3% respectively. We now forecast SFr733m operating profit in FY20e," the broker says.
Analysts say that this largely reflects the disruption caused by COVID-19, as well as the strength of the Swiss franc.
Credit Suisse also says that HK/China and Chinese consumers respectively represented 35% and 50% of FY 2019 sales.
"First, watch exports and consumer demand in Asia have decoupled since 3Q19 leading to inventory turns in the trade deteriorating to >260 days in 4Q19 globally against 180 days on normalized levels," Crédit Suisse explains.
"We forecast a 10% drop in 1H organic sales. This brings our operating margin estimates to 9.5% in FY20e and 12.1% in FY21e, down from 12.4% in FY19," analysts add.
Copyright (c) 2020 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.