Ontex Group Shares Close with a Technical Rebound Amidst a Weekly Collapse

Ontex Group's Performance: A Detailed Analysis

Ontex Group's stock recorded a 5.24% gain at close on Wednesday, December 17, ending the session at 4.62 euros, after reaching a low of 4.39 euros on Monday, now identified as an immediate technical support. The traded volumes remain low, with only 0.28% of the capital handled, indicating moderate activity that does not suggest a sustainable reversal of trend. Over a week, the stock has plummeted by 28.37%, while quarterly and annual performances are down by 25.96% and 43.8% respectively, placing Ontex among the sharpest declines in the European market. On December 11, the Belgian group shocked the market by lowering its adjusted EBITDA target for 2025 to a range of 175 to 180 million euros, from the previously expected 200 to 210 million euros, a revision of about 13% at the midpoint. This downgrade results from weaker-than-expected demand for baby diapers in October and November, and lower-than-expected volumes on new contracts in Europe and North America. Comparable sales are now expected to decline by 5 to 6%, against the previously anticipated 1 to 3%, heightening concerns about the robustness of the model. The debt ratio climbs to 3.2 times EBITDA versus the expected 2.5 times, adding to concerns about the group's financial structure in an environment characterized by sluggish consumption of private labels and intensified promotions by major brands.

Technical Indicators and Market Sentiment

The Relative Strength Index (RSI), a measure of relative strength, stands at 17, a level significantly below the oversold threshold set at 30, indicating a marked exhaustion of selling pressure and a situation of extreme overselling. This exceptionally low level suggests that the stock has been heavily sold off and that a technical rebound, even if limited, becomes statistically probable in the short term, as observed this Wednesday. However, a low RSI does not guarantee a sustainable turnaround and can persist for several sessions in a market structurally oriented downwards. The Chaikin Money Flow (CMF), at -0.32, confirms persistent and sustained selling pressure, indicating that the traded volumes continue to accompany the decline despite the rebound on this day. This indicator, which measures the accumulation or distribution of a stock over a given period, reflects deep institutional mistrust and an absence of structural buyers' return. The current price remains significantly below the reference moving averages: 6.07 euros for the MM20, 6.19 euros for the MM50, and 6.96 euros for the MM200, confirming a fundamental downward trend. The one-month volatility reaches 24.19%, a high level that reflects the ongoing uncertainty surrounding Ontex's ability to stabilize its business.

Strategic Measures and Governance Changes

In response to the continuous deterioration of its market environment, Ontex announced on December 11 the acceleration of an efficiency improvement initiative covering operations and overhead costs, with an ambitious target of 200 million euros in savings over three years. The implementation costs of this plan are expected to remain below 40 million euros. This cost-cutting drive aims to restore the group's competitiveness and support the improvement of margins as well as cash flow generation, in a context of structural volume decline. Concurrently, the board of directors has appointed Laurent Nielly, currently president of the Europe division, as the next CEO effective May 5, 2026. He will succeed Gustavo Calvo Paz, who has led the group during a period of strategic transformation marked by the divestiture of non-core activities and the optimization of operational footprint. This change in governance occurs at a pivotal moment when the group must demonstrably reverse the trend and regain the confidence of institutional investors. Complete results and outlook for 2026 will be detailed next February, when the market hopes to see tangible signs of operational improvement.