Hugo Boss Earnings: 2024 Outlook Falls Short of Expectations and Sends Stock Down by 17%

We expect to reconsider our fair value estimate of EUR 68 for narrow-moat Hugo Boss in the future as the company forecast sales and operating profit for 2024 below our estimates and company-compiled consensus. The company expects to earn EBIT between EUR 430 million and EUR 475 million, up from the EUR 410 million reported for 2023, but falling short of EUR 490 million expected by consensus and our estimates. Sales are expected to rise by 3%-6%, reaching around EUR 4.30 billion-EUR 4.45 billion, lower than our 7% forecast and consensus of around 9%, marking a significant slowdown from 15% growth in 2023. Hugo Boss may postpone its goal of reaching EUR 5 billion in revenue by 2025 due to consumer worries about inflation and higher borrowing costs hitting discretionary spending. Nonetheless, it anticipates achieving a minimum EBIT margin of 12% by then. The company's shares suffered a significant 17% decline at the time of writing.