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Investing.com - Bernstein SocGen Group raised its price target on Shiseido Co Ltd. (4911:JP) (OTC:SSDOY) to JPY2,000.00 from JPY1,700.00 while maintaining an Underperform rating on the Japanese cosmetics company. According to InvestingPro analysis, the company, currently valued at $7.2 billion, appears undervalued compared to its Fair Value.
The price target adjustment follows Shiseido’s mixed second-quarter 2025 results, which showed a 6.8% year-over-year decline in revenue but a 90.5% year-over-year growth in core operating profit. The company’s core operating profit beat analyst expectations while revenue fell short of consensus estimates. InvestingPro data reveals impressive gross profit margins of 76.8%, though the company remains unprofitable over the last twelve months. Subscribers can access 6 additional key insights about Shiseido on InvestingPro.
Like-for-like revenue declined 3% year-over-year despite an already low comparison base. China and Travel Retail segments continued to struggle with a 7% decline, while the U.S. market showed modest recovery with 4% growth on easier comparisons. Asia Pacific and EMEA regions delivered only flat to low single-digit growth.
Despite sluggish topline performance, Shiseido’s first-half core operating profit reached 23.4 billion yen, achieving over 60% of its full-year guidance. This profit improvement was primarily driven by enhanced profitability in Japan and an accelerated 5 billion yen cost-cutting program in Americas.
Bernstein noted that while Shiseido’s restructuring efforts remain on track, the company continues to face significant challenges with its topline growth across key markets.
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