Street Calls of the Week
Investing.com - Deutsche Bank has lowered its price target on Pandora A/S (CSE:PNDORA) to DKK1,100.00 from DKK1,150.00 while maintaining a Buy rating on the Danish jewelry maker’s stock.
The price target reduction reflects Deutsche Bank’s incorporation of rising silver costs into its financial models, with silver prices reaching approximately $47 per ounce. Despite the target cut, the bank continues to view Pandora favorably as indicated by its maintained Buy rating.
Deutsche Bank now forecasts a 12% reduction in its fiscal year 2027 estimates for Pandora, projecting a 75% gross margin and 21.5% EBIT margin. These projections fall short of Pandora’s Capital Markets Day targets but still compare favorably to industry peers.
The bank’s analysis considers potential mitigating actions Pandora might take, including the possibility of incorporating stainless steel in place of sterling silver in some products. Deutsche Bank suggests that a 25-30% stainless steel mix could potentially offset the projected 340 basis points year-over-year headwind for fiscal year 2027.
Deutsche Bank’s updated outlook also includes a preview of Pandora’s upcoming third-quarter results, though specific expectations for the quarter were not detailed in the analysis.
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