Investing.com — Shares of Rémy Cointreau (EPA: ) rose after the company reported a smaller-than-expected fall in its half-year EBIT, driven by better financial results and lower advertising spending.
At 5:09 am (10:09 GMT), Rémy Cointreau was trading 4.9% higher at €60.20.
The company’s EBIT for the first half of fiscal 2025 exceeded analysts’ expectations, with a decrease of 17.6% compared to the 20.6% decrease expected by the market consensus.
This unexpected performance resulted in a 10% hit to EBIT, analysts said Morgan Stanley (NYSE:).
“We estimate mid-FY25 guidance implies a revision of the contract of c.-4% on the top line and c.-12% on EBIT,” analysts at Stifel said in a note.
Analysts at Morgan Stanley noted that cash savings from lower sales costs and gains from foreign currency adjustments contributed significantly to the decline in sales.
Despite all the challenges, especially in the US and Chinese wine markets, the changes provided a temporary opportunity for the financial industry.
However, his views remain cautious. Rémy Cointreau revised its full-year guidance, forecasting a 15% to 18% decline in organic sales growth and a squeeze on EBIT margins to 21-22%.
The forecast reflects a downward revision to profit estimates, consistent with Morgan Stanley’s view that the company still faces headwinds, including tax-related uncertainty and continued weakness in key sectors.
However, Morgan Stanley remains skeptical, citing ongoing challenges and the possibility of continued underperformance in the short term.
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