We are maintaining our fair value estimate for narrow-moat Swatch Group as we incorporate full-year 2023 figures into our forecasts. We believe shares are undervalued at current levels.
Around three quarters of Swatch's revenue and higher share of profits are from higher-end watch and jewellery brands, and is not affected by smartwatch competition. Performance of low end brands is improving thanks to innovation and smartwatches reaching maturity.
Around 50% of demand for Swatch products comes from Asian customer, most notably Chinese, making the company vulnerable to adverse economic shocks and demand changes in the region.
|
Metric
|
SWGAY
|
RMS
|
MC
|
|---|---|---|---|
Price/Earnings (Normalized) | 11.41 | 52.72 | 26.20 |
Price/Book Value | 3.78 | 15.91 | 6.52 |
Price/Sales | 6.25 | 18.04 | 4.63 |
Price/Cash Flow | 35.01 | 47.25 | 17.35 |
|
Metric
|
SWGAY
|
RMS
|
MC
|
|---|---|---|---|
Quick Ratio | 2.50 | 3.58 | 0.58 |
Current Ratio | 8.61 | 4.40 | 1.32 |
Interest Coverage | 278.75 | 99.32 | 23.09 |
|
Metric
|
SWGAY
|
RMS
|
MC
|
|---|---|---|---|
Return on Assets (Normalized) | 6.27% | 24.29% | 11.43% |
Return on Equity (Normalized) | 7.31% | 33.36% | 27.46% |
Return on Invested Capital (Normalized) | 7.01% | 27.81% | 16.88% |
|
Ticker
|
Name
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|
LVMHF
| Lvmh Moet Hennessy Louis Vuitton SE | — | Qpmj | $424.2 Bil | |
LVMUY
| Lvmh Moet Hennessy Louis Vuitton SE ADR | Rrbjvbvjd | Gbqlx | $424.2 Bil | |
HESAF
| Hermes International SA | — | Cvwgb | $257.8 Bil | |
HESAY
| Hermes International SA ADR | Rzjlysxgf | Npd | $257.8 Bil | |
CHDRF
| Christian Dior SE | — | Cjd | $143.2 Bil | |
CHDRY
| Christian Dior SE ADR | — | Mkt | $143.2 Bil | |
TPR
| Tapestry Inc | Cflhctjgx | Lzqdvy | $9.2 Bil | |
CPRI
| Capri Holdings Ltd | Zjqtjbb | Nnvln | $4.4 Bil | |
REAL
| The RealReal Inc | Bcdx | Nydr | $346.5 Mil |
