S.E.B. stock declines 2.5% despite 24.5% rise in operating income
The small appliance manufacturer retreats significantly during trading, in a Paris market oriented downward, despite nine-month results praised for an increase in its profitability. The stock finds itself at the bottom of its index ranking, as analysts adjust their targets.
Operating income up 24.5% and annual target finally quantified
The S.E.B. stock lost 2.77% to €54.40, among the largest declines in the SBF 120, which fell 0.72%. The decline came after a publication that the market nevertheless appears to have received poorly: the operating income from the first nine months reached €333 million, up 24.5%, for a revenue of €5,707 million (+1.1% at constant exchange rates and scope). The operating margin rose from 4.7% to 5.8% of sales.
The Écully-based group also quantified its annual target for the first time, with ROPA growth expected between 5% and 10%. This is the first quarterly publication since Loïc Moutault's arrival as Chief Executive Officer on October 1st. However, the group describes a deteriorated macroeconomic and geopolitical environment, with uncertain consumption prospects and distributors remaining cautious about their inventory levels, which tempers the reading of the margin progression.
A stock trading below its 20-day and 50-day moving averages with price targets revised downward
On analyst views, Portzamparc lowered its target from €94 to €87 while maintaining a buy rating, which leaves potential of approximately 60% compared to the current price. The stock trades around 9.3 times the expected earnings for the current fiscal year, according to the consensus of surveyed analysts.
The decline places the price below its 20-day moving average at €55.82 (gap of 2.54%) and below its 50-day moving average at €57.03 (gap of 4.61%), while the 200-day moving average at €51.82 remains 4.98% below the price. The stock is thus moving away from its short-term averages, following a 4.9% decline over the week, but maintains a gain of 11% over three months. Support at €52.70 constitutes the nearest level in case of further decline.
