(News Bulletin 247) – Credit Suisse retains its Underperformance rating on Rémy Cointreau shares with a price target lowered to 155E, against 160E previously.
Although the guidance for FY24 has been revised downwards and the average annual growth rate of sales in the United States over 4 years is stabilizing, the stock needs ‘a positive inflection in sales, which could take some time,” said the analyst for whom Remy’s lack of geographical/product diversification “could necessitate an acquisition”.
‘Remy trades on a 25x basis at 12 months, ie a premium of 30% compared to large caps in the spirits sector (Diageo and Pernod)’, continues the broker.
The main points to watch for Credit Suisse are: ‘stronger growth momentum for Cognac in the United States and China; and lower interest rates resulting in higher multiples for growth stocks’
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