The Inditex group made headlines this Wednesday for disappointing the market by not meeting its profit expectations, despite having posted exceptional results in the third quarter of the year. For the first time in its history, Inditex achieved profits of 1.6 billion euros in a quarter, below the 1.7 billion estimated by experts. Given this, investors have not hesitated to undo positions, and since Wednesday the Galician firm has accumulated a drop of close to 9.2%. And despite not having met expectations in the balance sheet, the entities that form the consensus of analysts of Bloomberg who have revised their assessment of the company in recent days They have improved their valuation of the fashion company by 0.6% on average, leaving their target price at 52.2 euros, above the 51.9 euros they gave to these firms before the presentation of their accounts.
The market consensus that reflects Bloombergincluding some other entity that has not revised its target price these days, values this company’s share at 52.8 euros. It should be noted that of this entire set of analysts, only one house has changed its recommendation, which is RBC Capital. It has gone from giving a recommendation to keep putting a sign selling.
Regarding the changes in the valuations that Inditex receives, they stand out four entities that have improved the target prices they give to the brand by more than 8% fashionable. The one that has made the biggest change is Bryan Garnier & Co., with an 11.5% increase. The entity values a share of Zara’s parent company at 58 euros, compared to the 52 euros it previously gave it. Kepler Chevreux raises the target price given to the group by almost 10%, from 50 euros to 54 euros per share, above the average consensus price. Both entities advise acquiring shares of this company.
On the other hand, Mediobanca improves its valuation by 9.8%, increasing it from 41 euros to 45. In the case of this entity, its target price is still a 15.6% below that given by the market consensus. On the other hand, with this latest review Telsey Advisory is above the 52 euros that the group of experts gives it. Thanks to its 8% improvement, it rises up to 54 euros the estimated value of a company titlewhile before it gave him 50 euros.
However, most of the 26 analysts who have updated their data have decided not to change their assessments of the company, as is the case of Bankinter, which leaves its buy recommendation along with its target value at 55 euros. The analysis firm explains that they maintain their valuation unchanged, despite the fact that “the results for the third quarter of 2024 disappoint expectations: growth slows somewhat more than expected and margins are affected by a complex environment and negative impact due to exchange rate differences“, for “due to the growth of the net cash position and a slight reduction in the discount rate of cash flow free futures”.
From the bank they highlight that “fundamentals and business model remain very strong“even so, they estimate that”accused of a certain slowdown and maturity in growth and the difficulty of continuing to expand margins at very high levels with a historical perspective and compared to its competitors.
Bank of America have decided to reduce the target price they give to the firm’s securities to 59 euros, from the previous 61 euros, which represents a decrease of 3.2%. In addition to “reducing our EPS (earnings per share) estimates by 5% for the years 2025-2027, due to lower growth and lower margins in the years 2025-2026.” They reiterate, yes, “the purchase recommendation, taking into account Strong growth prospects, best-in-class margins and ongoing investments“.
This is also the case with Goldman Sachs, The firm lowers its valuation of Inditex shares by 5%, to 59 eurosalthough it remains above the average given by the analyst consensus. RBC Capital lowers its valuation of the firm by 3.8%, to 50 euros, while Deutsche Bank lowers its target price for a security of the firm by 3.7%, to 52 euros.
LinkedinBeloud
#Analysts #slightly #improve #Inditexs #valuation #disappointing #results
