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On Wednesday, Berenberg initiated coverage on Remy Cointreau (EPA:RCOP) SA (RCO:FP) (OTC: REMYY) with a Hold rating and set a price target at €47.60. The firm cited the stock’s current trading on depressed multiples in comparison to its historical performance, the broader beverages sector, and the consumer staples market. This valuation reflects the prevailing uncertainty over the company’s earnings trajectory.
According to the coverage, Remy Cointreau’s earnings per share (EPS) are projected to have dropped by as much as 60% from fiscal year 2023 to the forecasted fiscal year 2025. The analysis also highlighted potential exacerbating factors, such as tariffs in China and the United States, which could further impact the situation negatively.
Berenberg acknowledged the strategic importance of Remy Cointreau’s inventory but expressed skepticism that this would necessarily provide a solid bottom for the company’s share price. The firm pointed out that in past crises, the value of stockpiles had not always supported the share price. Given these considerations, the analyst expects the share price to likely continue facing downward pressure in the short term, as long as the trend in earnings forecast revisions remains negative.
The coverage by Berenberg offers a cautious outlook on Remy Cointreau’s financial performance, reflecting broader concerns within the industry and potential international trade challenges. The Hold rating and price target of €47.60 serve as a benchmark for investors to consider the stock’s potential amidst these uncertainties.
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