Puig shares jump after Q3 beat, upgraded outlook eases near-term concerns

Investing,com -- Puig Brands SA (BME:PUIGb)shares rose more than 8% on Friday after the Barcelona-based beauty and fashion group posted third-quarter results that topped expectations and raised its full-year 2025 sales guidance.

The update helped ease short-term concerns about a slowdown in the company’s fragrances business.

Puig reported like-for-like (LFL) sales growth of 6.1% in the third quarter, beating Visible Alpha consensus by 120 basis points, which had forecast 4.9%.

The performance was led by strength in make-up and skincare, while fragrances underperformed expectations.

The company said fragrance sales rose 2.8%, missing consensus by 70 basis points, reflecting what analysts at Citi Research described as “category moderation over the summer.”

Following the results, Puig raised its full-year 2025 LFL growth outlook from the lower end to the midpoint of its 6-8% range. 

Citi attributed the revision to “a solid start and greater visibility of the holiday sell-in,” with the company anticipating an acceleration in fragrance growth during the fourth quarter.

The brokerage estimated roughly 4% growth in fragrances for the final quarter, compared with Visible Alpha’s projection of around 1%.

Citi said the stronger-than-expected print “should partly alleviate market concerns over a fast slowdown of fragrances/Puig’s ST growth,” while noting that “questions on the growth algo beyond 2025 remain unaddressed.” 

Puig has scheduled a capital markets day for April 2026, where longer-term strategy updates are expected.

In its report, Citi projected mid-single-digit (MSD) like-for-like growth for 2026-2027 and around 6% earnings per share (EPS) growth in hard-currency terms. 

It said this could “warrant some multiple expansion at this stage given the undemanding valuation and a generally difficult staples space.”  The brokerage also noted an expected low-single-digit EPS upgrade.

The third-quarter results underscored a divergence across Puig’s product lines. Make-up and skincare continued to expand, while fragrances, traditionally a core driver of Puig’s revenue, showed softer growth. 

Citi linked the underperformance to seasonal moderation but indicated confidence in a rebound as holiday-related sales increase in the final months of the year.

Puig’s decision to lift its guidance marks a shift from the more cautious stance it held earlier in the year, when the company pointed to uncertainty in global consumer markets. 

The move to the midpoint of its 6-8% target range follows what Citi described as “a solid start” to the year and improved clarity on year-end sales trends.