Italian luxury-fashion giant Brunello Cucinelli saw its share price increase by 4.3% to EUR74.70 on Friday, following an upward revision of its 2023 revenue growth forecast. The company now expects a growth rate of between 20-22%, up from the previous estimate of 19%.
This adjustment comes in the wake of the company's strong performance over three quarters and a positive market response to its collections, which led to a significant increase in revenue. During this period, the firm's revenue surged from EUR 642.0 million to EUR 818.4 million ($866.2 million), marking considerable growth across all markets: Asia at 50%, Americas at 22%, and Europe at 20%.
On a constant-currency basis, the company recorded a 29% growth. Matt Garland, a Deutsche Bank (ETR:DBKGn) Research analyst, suggested that this robust performance and revised guidance could potentially push consensus expectations for 2023 sales toward the upper end of Cucinelli's projection.
InvestingPro data shows that Brunello Cucinelli's market cap is $11.41M USD, with a negative P/E ratio of -17.14, indicating that the company is not currently profitable. However, the company's PEG ratio of 0.04 suggests that it is undervalued given its projected earnings growth. The company's Price / Book ratio of 1.83 further indicates that it may be undervalued relative to its book value.
InvestingPro Tips highlights that Brunello Cucinelli has high earnings quality, with free cash flow exceeding net income, and yields a high return on invested capital. Moreover, the company has been consistently increasing its earnings per share. Despite trading at a high earnings multiple and P/E ratio relative to near-term earnings growth, the company's revenue growth has been slowing down recently.
For investors looking for more in-depth information, InvestingPro offers additional tips and real-time metrics for Brunello Cucinelli and other companies. These include insights into the company's debt level, EBIT valuation multiple, and predictions for profitability. To access these tips, visit InvestingPro.
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