Barclays downgrades Remy Cointreau stock to Underweight on cognac concerns

Investing.com - Barclays (LON:BARC) downgraded Remy Cointreau (EPA:RCOP) SA (EPA:RCO) from Equalweight to Underweight on Monday, maintaining a price target of EUR45.00. The stock, currently trading at $7.23, has shown strong momentum with a 16.84% gain in the past week, despite maintaining impressive gross profit margins of 70.57%.

The downgrade follows Barclays’ updated tariff modeling to reflect the current 30% expectation in the U.S. market, while increasing China expectations due to potential recovery in travel retail.

These adjustments have led Barclays to decrease its FY26 forecasts for the French spirits company, though it expects improved performance from FY27 onwards.

Barclays had previously upgraded Remy Cointreau to Equal Weight in anticipation of China tariff removals, which has since occurred along with a corresponding increase in the company’s share price.

The investment bank cited "structural issues in the cognac category" as a key concern, noting the considerable gap between the current share price and its EUR45.00 price target.

In other recent news, Remy Cointreau has been the focus of analyst activity, with significant updates regarding its financial outlook and stock evaluations. Jefferies analysts have raised the price target for Remy Cointreau stock to €70 from €65, maintaining a Buy rating. This decision is based on expectations for a medium-term recovery in the cognac market, which is expected to benefit the company. In contrast, Barclays analyst Laurence Whyatt upgraded the stock rating from Underweight to Equalweight and increased the price target to €39 from €34. Despite the underwhelming fourth-quarter sales, Whyatt highlighted the company’s optimistic outlook for fiscal year 2026. Remy Cointreau anticipates double-digit growth in the U.S. market, driven by improved sell-out and restocking efforts. CFO Luca Marotta expressed confidence in the consensus estimates, projecting approximately 4.6% organic sales growth and around 4.3% organic profit growth. These developments reflect varying analyst perspectives on the company’s future performance and market potential.

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