(CercleFinance.com) – The Maisons du Monde stock is up slightly this afternoon after falling 27% on Friday following the announcement of a downward revision of its objectives for the entire financial year.
Berenberg lowered his price target on Maisons du Monde this morning, which he reduced from 26 to 21 euros, taking note of the degraded environment and the low visibility in which the brand of furniture and decoration stores operates. .
The German intermediary, which maintains its buy recommendation on the value, recalls that Maisons du Monde attributed its recent profit warning to the deterioration of its market and the tensions which penalize its supplies.
‘If these worries are not a real surprise, the extent of the downward revision of its objectives and the ‘timing’ of the announcement explain the particularly negative reaction around the title’, underlines the broker.
Oddo confirms its cautious view (Neutral) with a price target lowered to E16 (instead of E20). ‘Following these announcements, our 2022-2023 EBIT estimates have been revised down by 40% on average’.
‘We therefore note that the group mentions 1/ a deterioration in demand in the furniture and decoration sector in recent weeks due to high inflation which is weighing on the level of consumer confidence; 2/ the continuation of major bottlenecks in China following the continuation of the pandemic, which translates into additional costs and the slowdown in supplies; 3/ freight, raw materials and energy costs which remain high and will weigh on the gross margin beyond management’s expectations (initially forecast to fall by around 100/150bp to 65%)’ indicates Oddo.
The analysis underlines that sales are expected to fall to mid-single digit negative, whereas so far the group had been expecting sales to increase. The EBIT margin should be 5% or more, vs around 9%. The FCF should be in a range of 10-30 ME (vs 65-75 ME initially estimated).
‘ As regards the 2025 objectives presented during the CMD in November (in particular: 1.8-1.9 MdE of turnover; EBIT margin 11%; cumulative FCF 350 ME), the group specifies that these remain valid with, however, a calendar which could be lengthened’ adds the analysis office.
Copyright (c) 2022 CercleFinance.com. All rights reserved.
The information and analyzes disseminated by Cercle Finance only constitute a decision-making aid for investors. The responsibility of Cercle Finance cannot be held directly or indirectly following the use of information and analyzes by readers. It is recommended that any uninformed person consult a professional adviser before any investment. This indicative information does not in any way constitute an incitement to sell or a solicitation to buy.