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    HM B   SE0000106270

HENNES & MAURITZ AB

(HM B)
  Report
Real-time Estimate Quote. Real-time Estimate Cboe Europe - 10/25 10:30:00 am
166.78 SEK   -0.13%
10/06H&M : Deutsche Bank reiterates its Sell rating
MD
10/01HENNES & MAURITZ : Notice of general meeting
AQ
09/30H&M : Credit Suisse keeps a Sell rating
MD
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H&M boosted by reassurance on pricing, new collections

09/27/2018 | 11:30am EDT
Logos of H&M are pictured on a store in Geneva

STOCKHOLM (Reuters) - Shares in H&M jumped more than 10 percent on Thursday after sales turned the corner in many of its markets as new collections proved popular and the fashion group said it would not need more price cuts to shift unsold clothing.

The stock was up 10.9 percent at 1425 GMT, having lost nearly two thirds of its value from record highs in 2015. Many in the market have bet on the shares falling, meaning any positive news tends to prompt a strong reaction.

The Swedish group has seen profits shrink and inventories pile up in recent years as its core budget chain lost sales to low-price high-street rivals like Primark and online competitors such as ASOS and Zalando.

In response, the second-biggest clothing retailer after Zara owner Inditex has invested heavily in logistics and ecommerce and is reviewing its mix of stores and brands. It is also working on a new store concept and more fashionable ranges.

CEO Karl-Johan Persson said new summer and autumn styles released in the quarter were better received by shoppers than last year, boosting sales in many markets.

"The big explanation is that many customers appreciate the new collections that we have developed," he told Reuters.

"There are positive signals, definitely," he added, noting that online sales spiked 32 percent, outpacing recent figures from ASOS and Zalando.

SUPPLY CHAIN GLITCHES

Teething problems with a new logistics system designed to help improve its supply chain and better integrate stores and its website hit fiscal third-quarter profits.

The glitches led to extra costs and an 8 percent sales drop in the United States, France, Italy and Belgium.

However, sales for its other 66 markets increased by 8 percent in local currencies during the quarter. Analysts at Credit Suisse said that meant comparable sales in those markets may well have been up for the first time in three years.

In September, the start of H&M's fourth quarter, the underlying sales trend was positive, Persson said.

H&M said it did not expect increased discounting in the current quarter thanks to the "quality and balance" of its stock, which Persson said now includes fewer out-of-fashion clothes and more recent ranges and timeless ranges.

H&M's markdowns increased 0.7 percentage points in the third quarter, and inventories rose 15 percent to 38.7 billion crowns.

RBC analyst Richard Chamberlain noted that H&M had not yet started shifting the online platform in its biggest market Germany.

"We still see the risk to consensus estimates as on the downside, however H&M is working its way through some of its issues and has given more reassuring guidance on markdowns for Q4," said Chamberlain, who has a "Neutral" rating on the stock.

Extra costs totalling 400 million crowns related to the logistics problems weighed on profits. Persson told analysts in a call that the problems would affect costs and sales to a lesser extent in the fourth quarter.

June-August pretax profit for shrank 20 percent from a year ago to 4.01 billion crowns ($454 million). Analysts had forecast a 16 percent drop.

British online rival Boohoo this week reported forecast-beating profit growth for the first half of the year. Britain's Next reported better-than-expected trading in late summer.

(Additonal reporting by Emma Thomasson; Editing by Keith Weir)

By Anna Ringstrom


ę Reuters 2018
Stocks mentioned in the article
ChangeLast1st jan.
ASOS PLC -4.62% 2642 Delayed Quote.-42.02%
ASSOCIATED BRITISH FOODS PLC 2.61% 1770.5 Delayed Quote.-23.72%
BOOHOO GROUP PLC -3.53% 190.2938 Delayed Quote.-42.52%
HENNES & MAURITZ AB 0.05% 167.14 Delayed Quote.-2.91%
INDITEX -0.29% 30.68 Delayed Quote.18.13%
JUST GROUP PLC 1.62% 93.85 Delayed Quote.32.48%
NEXT PLC 0.33% 7864 Delayed Quote.10.58%
WILL GROUP, INC. -0.69% 1289 End-of-day quote.28.13%
ZALANDO SE 0.35% 80.58 Delayed Quote.-11.99%
All news about HENNES & MAURITZ AB
10/06H&M : Deutsche Bank reiterates its Sell rating
MD
10/01HENNES & MAURITZ : Notice of general meeting
AQ
09/30H&M : Credit Suisse keeps a Sell rating
MD
09/30H&M : Jefferies gives a Neutral rating
MD
09/30H&M : Receives a Buy rating from RBC
MD
09/30H&M : Goldman Sachs remains Neutral
MD
09/30H&M : Buy rating from RBC
MD
09/30HENNES & MAURITZ : Low-cost fashion chain H&M sees sales pick up after virus
AQ
09/30HENNES & MAURITZ : Board of H & M Hennes & Mauritz AB proposes dividend
AQ
09/30H & M Hennes & Mauritz AB Proposes Dividend, Payable on 4 November
CI
More news
Analyst Recommendations on HENNES & MAURITZ AB
More recommendations
Financials
Sales 2021 200 B 23 228 M 23 228 M
Net income 2021 10 280 M 1 194 M 1 194 M
Net Debt 2021 44 688 M 5 192 M 5 192 M
P/E ratio 2021 26,9x
Yield 2021 4,19%
Capitalization 276 B 32 217 M 32 111 M
EV / Sales 2021 1,61x
EV / Sales 2022 1,41x
Nbr of Employees 153 000
Free-Float 43,2%
Chart HENNES & MAURITZ AB
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Hennes & Mauritz AB Technical Analysis Chart | HM B | SE0000106270 | MarketScreener
Technical analysis trends HENNES & MAURITZ AB
Short TermMid-TermLong Term
TrendsBearishBearishBearish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 24
Last Close Price 167,00 SEK
Average target price 201,65 SEK
Spread / Average Target 20,7%
EPS Revisions
Managers and Directors
Gudrun Helena Lundberg Helmersson Chief Executive Officer
Adam Gustav Karlsson Chief Financial Officer
Karl-Johan Erling Persson Chairman
Alan Boehme Chief Technology Officer
Anders Gunnar Dahlvig Independent Director
Sector and Competitors
1st jan.Capi. (M$)
HENNES & MAURITZ AB-2.91%32 217
INDITEX18.13%111 452
KERING8.70%93 347
FAST RETAILING CO., LTD.-21.29%65 375
ROSS STORES, INC.-10.11%39 229
ZALANDO SE-11.99%23 399