- H&M’s operating profit for the third quarter was SEK 4.91 billion, exceeding estimates of SEK 3.74 billion.
- Pretax profit also surpassed expectations at SEK 4.32 billion, compared to an estimate of SEK 3.29 billion.
- Total sales reached SEK 57.02 billion, slightly below the projected SEK 57.12 billion.
- Gross profit was reported at SEK 30.14 billion, above the estimated SEK 29.42 billion.
- The company’s gross margin stood at 52.9%, higher than the anticipated 51.4%.
- Operating margin achieved was 8.6%, beating the forecasted 6.55%.
- Net income for the quarter was SEK 3.23 billion.
- H&M’s store count decreased by 48, resulting in a total of 4,118 stores, marking a 4.2% year-over-year reduction.
- Sales by region for the nine-month period included: Nordics – SEK 15.01 billion, Western Europe – SEK 57.76 billion, Eastern Europe – SEK 15.25 billion, Southern Europe – SEK 22.76 billion, Americas – SEK 37.31 billion, and Asia, Oceania & Africa – SEK 20.97 billion.
- Plans for 2025 involve opening over 80 new stores, predominantly in growth markets.
- September 2025 sales are anticipated to match the same period last year in local currencies.
- The autumn collections have been well received by customers.
- Markdowns as a percentage of sales are expected to be slightly higher in the fourth quarter due to an earlier Black Friday.
- H&M aims to improve its stock-in-trade position through a better supply chain and purchasing strategy.
- Store portfolio optimisation continues, with over 200 closures planned for 2025, mainly in established markets.
- Some Monki stores will be converted into Weekday stores.
- The company is closely watching global trade developments and potential trade restrictions.
- Current market recommendations include 5 buys, 12 holds, and 14 sells.
Hennes & Mauritz AB on Smartkarma
Analyst Coverage of H&M on Smartkarma
Analyst coverage on Smartkarma delves into Hennes & Mauritz AB (H&M) with a bull lean as highlighted by Baptista Research in their report titled “H&M (Hennes & Mauritz AB): Initiation of Coverage- The High-Stakes Bet on Value”. The report assesses H&M’s first-quarter 2025 results, revealing a mixed performance as the company strategizes for long-term profitable growth. Sales in Swedish krona saw a 3% increase, while local currency sales rose by 2%. Strong sales were noted in Western, Southern, and Eastern Europe, with standout performances in Germany and Poland. However, sales were weaker in Northern Europe and the U.K., as well as in the U.S. Baptista Research aims to provide insights into the factors that may impact the company’s valuation in the short term, employing a Discounted Cash Flow methodology for independent valuation.
A look at Hennes & Mauritz AB Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 5 | |
| Growth | 3 | |
| Resilience | 3 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.4 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Based on the Smartkarma Smart Scores, Hennes & Mauritz AB (H&M) shows a promising long-term outlook. The company receives high scores in areas like Dividend (5) and Momentum (4), indicating strong performance in these aspects. With a solid foundation in providing dividends and positive momentum, H&M demonstrates stability and growth potential for investors looking for consistent returns.
Although the company scores slightly lower in Value (2), Growth (3), and Resilience (3), these factors still contribute positively to H&M’s overall outlook. The company’s focus on value, growth, and resilience reflects a balanced approach to maintaining its position in the market while adapting to changing consumer trends. With a diverse range of fashion offerings and a strong presence in multiple countries, H&M remains a key player in the retail industry.
Summary: Hennes & Mauritz AB (H&M) is known for designing and selling fashionable clothing and accessories for a wide range of demographics. Operating stores in various European countries and the U.S., H&M offers trendy, sporty, and classic apparel along with accessories like jewelry, bags, scarves, and cosmetics.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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