AlsterResearch Update: Hugo Boss - Q3 figures exceeded prepandemic levels

Hugo Boss AG (Update)   Retail MCap EUR 3.7bn BUY PT EUR 67.00 (up from 64.00, +26% potential)   Hugo Boss reported Q3 figures that not only showed strong growth yoy, but also versus pre-pandemic 2019 comparables. We upgrade estimates and price target.   Read

What’s it all about?

According to preliminary figures, Hugo Boss achieved sales of EUR 755m in Q3 2021. With a sales increase of 7% in currency-adjusted terms in a two-year comparison, the Group has already left the pandemic behind in many markets and has returned to the path of expansion. Only Asia/Pacific is still lagging but should catch up as soon as higher vaccination rates allow the countries to ease the Corona-related restrictions. Therefore, we expect demand for high-quality menswear to pick up significantly. Growth in Europe and America is particularly encouraging. Under the new CEO, the Group is likely to place even greater emphasis on these sales regions in the future. A stable pillar of expansion is the company's own retail trade in combination with the now established online trade. In this way, price sovereignty can be defended, the brand image cultivated, and profitability expanded. We raise earnings estimates for 21E to 24E by 6% to 8%. As such, we raise our price target from EUR 64.00 to EUR 67.00 now yielding an upside potential of 26%. The rating remains a BUY.