Swatch: Invest Securities raises target price

(CercleFinance.com) - Invest Securities believes that Swatch's second half of 2020 has cushioned the shock of the first half (EBIT loss of 344 million Swiss francs or -15% of sales), to end on a figure that is bang in line with the annual consensus.


The analyst says that it is fundamental to note that the last financial year marks a break in management, with a new rigour (sharp drop in stocks, accelerated shop closures, etc.) in terms of the approach to costs and the operating cycle, etc. Is it the resulting potential for optimisation that partly explains the company's very upbeat forecasts, which clearly seem to be putting the pandemic behind it, hoping to return to sales that are close to the 2019 level by the end of 2021?

The broker adds that it is far from this - both in terms of sales and results, having slightly increased its (EBIT expected at 700 million Swiss francs). The company is not particularly expensive in view of the quality of its assets, although does not inspire us to the point of changing its rating on the stock (which remains neutral), albeit with an increased target price of 250 Swiss francs (vs. 210 Swiss francs adopted in July).


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