Research Market strategy
By Swissquote Analysts
Published on 19.01.2023
Morning news

Geberit to lose momentum in 2022

Topic of the day

Sanitary installation specialist Geberit slowed down last year in a difficult environment, marked in particular by soaring costs and currency effects. The Jona-based company nevertheless confirmed its medium-term objectives. Over the past 12 months, the St. Gallen-based multinational saw its net revenues fall by 2% to 3.39 billion francs, as wholesalers emptied their stocks with energy and raw material prices rising. Excluding exchange rate fluctuations, however, revenues edged 4.8% higher, Geberit announced on Thursday. The gross operating margin (Ebitda) is expected to be around 27% for the past year. These figures are in line with the company's expectations for the Ebitda margin, while missing the mark for growth. In November, Geberit reported it expected to grow in 2022 in local currencies "in the high single digits". Geberit nevertheless maintained its confidence of achieving its medium-term financial targets of average annual net sales growth of 4% to 6% excluding currency effects and an Ebitda margin of 28% to 30%. Detailed results for 2022 will be announced on 8 March.

Swiss stocks

The Swiss stock market edged lower again on Wednesday. The SMI lost 0.3 per cent to 11,367 points. Among the 20 SMI stocks, there were ten price losers and ten price winners. 45.75 (Tuesday: 39.37) million shares were traded. Nestle fell by 1.7 per cent and was the weakest stock in the SMI. The 1 per cent drop in Novartis, another index heavyweight, also had a braking effect on the SMI. Richemont was on the winning side with a plus of 0.7 per cent. The luxury goods group posted lower-than-expected sales in its third quarter, mainly due to the slump in demand in China due to Covid restrictions. However, traders were looking to the future after Covid in China, where a strong recovery in business was expected. Sika increased by 1.9 percent to 262 francs, driven by an upgrade of the price target to 275 from 250 francs with a simultaneous buy recommendation by Stifel. Logitech led the way with a plus of 2.1 per cent. Like the tech sector as a whole, which is considered sensitive to interest rates, the stock benefited from the further decline in market interest rates. The Stoxx technology sub-index gained 1.2 per cent.

International markets


European equities were little changed on Wednesday, mostly struggling for direction, as investors continued to fret about global economic growth and monetary policy direction. The Stoxx Europe 600 index gained 0.2% to 457.5 points. In Paris, the CAC 40 and the SBF 120 each added 0.1%. The DAX 40 in Frankfurt was flat while the FTSE 100 increased by 0.3% in London. Inflation slowed last month in the euro zone, according to final data released Wednesday by Eurostat, the European statistics agency. In line with the first estimate, the consumer price index rose by 9.2% in December over a year, after 10.1% in November. Fnac Darty (-6.8%), a retailer of cultural products and household appliances, lowered its operating cash flow target for the period 2021-2023, after suffering a decline in sales in 2022 in a consumer environment depressed by inflation. BNP Paribas (+0.3%) announced that Bank of Montreal (BMO) had received the necessary regulatory approvals to complete the acquisition of the French bank's US subsidiary, Bank of the West. The deal is expected to close on 1 February. Carmaker Renault (-2%) reported that the group's global sales fell by 5.9% in 2022, in a market still plagued by supply problems. Deutsche Bank raised its target price for Accor's shares (+1.7% to 28.5 euros) from 30.50 to 31.90 euros, while reiterating its "buy" recommendation. The bank also raised its target price for the group of collective catering Elior (+1.6% to 4.07 euros) from 2.50 to 4.22 euros, while maintaining its "keep" recommendation. British luxury goods group Burberry (+3.3% in London) reported lower-than-expected like-for-like revenue growth in the third quarter of its 2022-2023 financial year, hurt by disruptions in China due to rising Covid-19 cases.

United States

Stocks fell Wednesday after a fresh batch of economic data offered worrying signs of how the economy is weathering the Federal Reserve’s tightening campaign. The S&P 500 lost 62.11 points, or 1.6%, to 3928.86 with each of its 11 sectors in the red. The Dow Jones Industrial Average dropped 613.89 points, or 1.8%, to 33296.96. The Nasdaq Composite Index shed 138.10 points, or 1.2%, to 10957.01. All three major indexes gave up gains made in early trading. Wednesday morning data showed retail sales fell 1.1% in December, with higher interest rates and inflation hurting spending on vehicles, gasoline and furniture. Wholesale price inflation fell to its slowest pace since March 2021, brightening the price outlook for consumers and policy makers but casting a cloud over hopes for a “soft landing.” Moderna shares rose $6.33, or 3.3%. to $197.02 after the company released trial results for a vaccine to fight the RSV virus. PNC Financial Services fell $9.78, or 6%, to $152.07 after the bank set aside $408 million for credit losses in its quarterly results. United Airlines presented convincing financial results. The share price nevertheless came under heavy pressure and lost 4.6 per cent. The company's CEO Scott Kirby had warned that bottlenecks in personnel and technology were limiting growth in the industry, more so than many competitors thought. Progress Software's financial results were described as mixed, with the share price losing 3.2 per cent. After an experimental HIV vaccine from Johnson & Johnson proved ineffective, the share price declined by 1.5 per cent. Moderna, on the other hand, added 3.3 per cent. The company's respiratory vaccine candidate met primary endpoints in a phase 3 trial. Disney (-0.9 per cent) was supported by China's approval, after much wrangling, of the screening of two films from Disney-owned Marvel Studios. Microsoft slipped by 1.9 per cent. The group had confirmed the rumoured cut of 10,000 jobs, just under 5 per cent of the workforce.


Asian stocks were mixed on Thursday. China’s benchmark Shanghai Composite edged up 0.3%, while Hong Kong’s Hang Seng also added 0.3% and Japan’s Nikkei 225 index shed 1.4%. In Japan, export stocks were under pressure. Toyota Motor lost 2.4 per cent and Nissan Motor 3.5 per cent. In Hong Kong, technology stocks caused some headwinds. Alibaba edged 0.8 per cent lower and Baidu 1.8 per cent. Shares in games developer Netease now slipped by 1.7 per cent after the previous day's significant gains. Market participants again pointed to the previous day's announcement that the company had rejected a proposal to extend its long-standing partnership with US video game maker Activision Blizzard.


U.S. government debt yields fell sharply Wednesday, with rates on 2- and 10-year notes ending the U.S. session at or near four-month lows, after data showed U.S. retail sales sank more than expected last month and a measure of wholesale prices declined. Yields had initially dropped after the Bank of Japan maintained its ultra-lose monetary policy. The 10-year Treasury note fell 16 basis points to 3.372%. The 2-year Treasury note eased by 11 basis points to 4.098%.


CS lifts Comet target to 290 (215) CHF - Outperform
UBS lowers target Kuehne + Nagel to 246 (255) CHF - Buy
Stifel raises Sika target to CHF 275 (250) - Buy

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