Inditex continues unstoppable. The multinational of Galician origin will present this Wednesday the results of its second fiscal quarter, ended on July 31, and hopes, as it did in the previous ones, to once again beat its own revenue and profit records. It will do so for one more quarter and there will be ten consecutive quarters, supported by its own expansion plan and global inflationary tension, factors that will increase revenues by 12%, to around 9,058 million euros (8,103 million in the second quarter of the year). last year), according to Bloomberg estimates.
This estimate is replicated in the profits, which in the period between April and July will amount to around 1,270 million in net profit, improving by 23% and growing by 200 million compared to the result of twelve months ago. Ebitda, for its part, will be around 2,359 million, a value that Bankinter believes could increase even more, to 2,462 million.
It will increase its global market share
Bloomberg Intelligence highlights the importance of new fashion collections as the main driver of sales and points to a foreseeable increase in Inditex’s market share due to the closure of its rivals’ stores. “Productivity with a positive margin, which is not shared by its rivals, supports the decision to accelerate store openings, especially in the United States, Inditex’s second market,” says analyst Tatiana Lisitsina.
Among the possible weaknesses of the results, the expert points out a gross margin limited by the strength of the euro, although it will continue within the objective of plus/minus 50 basis points; a reduction in net cash after the payment of the dividend, and an increase in capital expenditures up to €1.6 billion derived from the company’s aircraft in the US.
The Deutsche Bank think tank reduces the sales estimate to 8,945 million euros motivated by a “slight slowdown from +16% sold in the first five weeks of the second quarter to +12% in the rest.” Their calculations foresee an increase in gross margin of 20 basis points to 56.2% (56% real).
A stock with a lot of potential
Given prospects like these, analysts have begun to update their recommendations and are setting target prices substantially higher than the current one. Compared to the 35.50 euros that the textile chain marks on the trading floor, a value in the zone of maximums – discounting the effect of dividends on capitalization -, Bloomberg’s consensus estimates place Inditex’s stock for the next 12 months around 37 euros, with a potential return of more than 4%.
But this figure falls short even for other analysts. The most optimistic is the German bank Bernstein, which has raised the target price of Inditex shares from 38 to 40 euros with a recommendation of overreturn. Caixabank BPI, which sets the target price at 39.90 euros, and the Swiss entity HSBC, which observes the action at around 39 euros, have similar figures.
Somewhat below are the forecasts of the investment fund manager Oddo BHF, with 38.50 euros, and Morgan Stanley, with 38 euros; And it adds in its favor that in recent days Bank of America has changed its recommendation, going from ‘neutral’ to ‘buy’. All these prices would break the historical ceiling on the stock market of the Galician multinational, which has become one of the catalysts of the Ibex in the last year, with shares that register a growth of 64% from the around 20 euros in which They were 52 weeks ago.
