Hugo Boss AG : The luxury not expensive
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08/06/2012 | 03:39am
Opinion : Bullish above 73 EUR
Target price : 90 EUR
Stop loss: 72 EUR
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XETRA (ALLEMAGNE)
Apparel / Accessories |
Hugo Boss has recently released its second quarter results. Revenue has grown 14% to €485 million, and also net profit rose 23% to €40 million. Hugo Boss main markets remain Germany, UK and USA. On the other hand, the disappointment comes from Asia, where the brand grows slower than forecast, 4% against 9%. However, the group disappointed analysts because of gross margin erosion, which fall from 65.3% to 64.2%.
From a fundamental point of view, the company remains attractive, with a price earnings ratio of 16.5 and 14.7. This valuation is really interesting for luxury sector.
Since April the share is trading in a neutral range between EUR 73 and EUR 83. In July the stock has tried to break out this range but it was stopped by resistance trend line. Moving averages in daily data are flat and they do not give a real orientation. Now the share is testing the support trend line and for this reason we could forecast a technical rebound towards as first target of EUR 83, and then we could aim EUR 90. A stop loss at EUR 72 is necessary to cover the position.
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Valuation |
2013e |
2014e |
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PER (Price / EPS)
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17,1x |
14,9x |
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Capitalization / Revenue
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2,41x |
2,22x |
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EV / Revenue
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2,44x |
2,21x |
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EV / EBITDA
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10,7x |
9,29x |
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Yield (DPS / Price)
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4,15% |
4,74% |
| Profitability |
2013e |
2014e |
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Operating Margin (EBIT / Sales)
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19,1% |
19,9% |
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operating laverage (Delta EBIT / Delta Sales)
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1,53x |
1,56x |
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Net Margin (Net Profit / Revenue)
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13,9% |
14,6% |
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ROA (Net Profit / Asset)
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28,9% |
29,6% |
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ROE (Net Profit / Equities)
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49,5% |
46,7% |
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Rate of Dividend
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70,9% |
70,8% |
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