On Wednesday, Citi analysts maintained a Buy rating on Remy Cointreau (EPA:RCOP) SA (RCO:FP) (OTC: REMYY) with a steady price target of EUR100.00. The affirmation follows a review of the company's financial forecasts in light of recent foreign exchange (FX) fluctuations, leading to a slight increase in earnings per share (EPS) estimates for fiscal years 2025 and 2026.
Remy Cointreau is expected to face its steepest quarterly sales decline in Q3, estimated by Citi to be around 24%. However, this anticipated drop aligns with the company's previous guidance. Citi analysts project that management will reiterate their commitment to achieving the forecasted -15% to -18% organic sales growth (OSG) for fiscal year 2025.
Despite ongoing competitive pressures in the U.S. cognac market, Remy Cointreau has reportedly seen sequential improvements in depletions, a measure of distributor sales to retailers. This positive trend, combined with the support from foreign exchange benefits, is expected to provide some buoyancy to the company's stock performance.
In addition, the Ministry of Commerce of the People's Republic of China (MOFCOM) has recently extended its anti-dumping investigation into imported cognac by three months, with a new deadline set for April 5, 2025. This extension offers a possibility for a favorable outcome for Remy Cointreau, which could further bolster investor confidence in the stock.
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