Shares of Remy Cointreau led the way as European peers such as Diageo, Pernod Ricard, and Davide Campari-Milano also saw their stocks rise. Analysts have praised the outlook of the French drinks maker, providing some much-needed relief to investors.
At 0855 GMT on Friday, Remy Cointreau shares experienced a significant 13% surge to reach EUR99.26. However, the stock is still down about 14% since the beginning of the year. Pernod Ricard saw a 6.2% increase, while Campari and Diageo rose 3.7% and 3.5%, respectively.
In its latest report, Remy Cointreau revealed that its sales for the quarter ending in December amounted to 319.9 million euros ($347 million). This represents a 27% decline compared to the same period last year. On an organic basis, quarterly sales were down 24%. The company attributes this decline to intense promotional activity in the U.S. cognac market, slower-than-expected economic recovery in China following Covid-19, and the impact of inflation on European consumers.
Looking ahead, Remy Cointreau now anticipates a nearly 20% decrease in sales for the fiscal year ending in March. This falls at the higher end of its previously stated range of 15% to 20%.
According to a research note from Jefferies analysts Edward Mundy and Andrei Andon-Ionita, the confirmation of Remy Cointreau’s fiscal 2024 guidance should bring some relief to investors. As confidence in the company’s recovery grows, it is expected that shares will rebound.
