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On Thursday, DA Davidson maintained a positive outlook on Inter Parfums (NASDAQ:IPAR) shares, raising the price target to $170.00 from the previous $163.00, while keeping a Buy rating on the stock. The adjustment comes after Inter Parfums reported fourth-quarter sales for 2024 that met expectations and exceeded earnings per share (EPS) projections. The company has forecasted a mid-single digit growth for the industry, with an 11% increase in 2024. According to InvestingPro data, the company maintains impressive gross profit margins of 63.85% and has achieved a revenue growth of 10.22% over the last twelve months.
Inter Parfums expects to continue its upward trajectory, aligning product sell-in with sell-through rates. The company has sustained its guidance for a 4% increase in sales for 2025, despite anticipating a 1% decrease due to exits and a 2% negative impact from foreign exchange rates. This implies a stronger organic sales growth than previously projected. InvestingPro analysis reveals the company’s strong financial health with a "GREAT" overall score, supported by robust liquidity metrics and consistent dividend payments maintained for 24 consecutive years.
The company’s financial health appears robust, with free cash flow in 2024 reported at approximately $180 million, a significant rise from around $70 million in 2019. In response to its solid financial performance, Inter Parfums has increased its dividend by 7%. The firm’s optimism is further buoyed by the anticipation of major new products in 2026 for its most prominent brands.
DA Davidson’s revised price target is based on a price-to-earnings (P/E) multiple of 29 times the estimated 2026 EPS of $5.85. This is an increase from the earlier P/E multiple of 28 times. The analyst’s decision to raise the target price reflects confidence in Inter Parfums’ growth prospects, underpinned by the company’s strong organic growth and the potential success of future product launches.
In other recent news, Inter Parfums reported a 10% year-over-year increase in fourth-quarter sales, reaching $1.452 billion for 2024, with a slight miss on earnings per share (EPS) forecasts but a slight beat on revenue expectations. The company confirmed its guidance for 2025, projecting sales of $1.510 billion and an EPS of $5.35 per share. Inter Parfums also announced a 7% increase in its dividend to $3.20 per share, reflecting a strong financial position with $235 million in cash and cash equivalents. Analysts from Canaccord Genuity and Piper Sandler have raised their price targets for Inter Parfums to $168 and $169, respectively, maintaining positive outlooks on the stock.
Canaccord Genuity highlighted the company’s ability to meet guidance during volatile periods, while Piper Sandler noted the company’s strong cash position and increased investments in advertising and promotion. Inter Parfums’ management expressed confidence in achieving the FY25 guidance, despite potential challenges in the prestige beauty industry and higher foreign exchange rates. The company plans several product launches and continues to focus on brand-building strategies.
Inter Parfums’ recently acquired brands, Lacoste and Roberto Cavalli, have met or surpassed expectations, contributing to the company’s growth. The company remains optimistic about its future performance, with new product launches anticipated to begin in the second quarter of FY25.
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