H&M: UBS downgrades stock

(CercleFinance.com) - UBS has downgraded its H&M shares from "buy" to "neutral", having slashed its target price from 200 Swedish kronor to 125 Swedish kronor, implying a downside potential of 3% for the clothing chain's shares.


Despite reporting Q2 adjusted PBT that was about 12% above expectations, the broker says it sees downside risks for the Scandinavian group of between 1% and 10% on consensus pre-tax profit (PBT) for the years 2022 to 2024.

"We don't think recently upgraded consensus H2 PBT estimates (following the c.12% Q2 adj. PBT beat) appropriately reflect the level of markdown risk, FX headwind and general opex," it said.


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