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
|
UHR
|
RMS
|
MC
|
|---|---|---|---|
Price/Earnings (Normalized) | 11.71 | 53.64 | 25.58 |
Price/Book Value | 0.83 | 16.19 | 6.37 |
Price/Sales | 1.28 | 18.35 | 4.52 |
Price/Cash Flow | 7.18 | 48.06 | 16.94 |
|
Metric
|
UHR
|
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
|
UHR
|
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 | — | Lsmh | $425.5 Bil | |
LVMUY
| Lvmh Moet Hennessy Louis Vuitton SE ADR | Xnytsxy | Rkmv | $424.5 Bil | |
HESAF
| Hermes International SA | — | Sqyr | $257.4 Bil | |
HESAY
| Hermes International SA ADR | Qrnjzcssw | Hqpth | $257.4 Bil | |
CHDRF
| Christian Dior SE | — | Shv | $143.4 Bil | |
CHDRY
| Christian Dior SE ADR | — | Ddzql | $140.4 Bil | |
SWGAY
| The Swatch Group AG ADR | Cznhstkf | Fbdjx | $11.0 Bil | |
TPR
| Tapestry Inc | Mzphvfs | Wpfsm | $9.0 Bil | |
CPRI
| Capri Holdings Ltd | Slktbvm | Jvy | $4.3 Bil | |
REAL
| The RealReal Inc | Vnvy | Ryzh | $356.0 Mil |
