Gainers:
- Hotel Chocolat (+169%): A meteoric rise for the small British chocolatier (Capitalization: 164 million pounds). US giant Mars is to acquire the high-end manufacturer and retailer for £534 million, and expand its presence in the UK (where it owns 130 stores) and internationally.
- Target (+20%): In these inflationary times, Target is holding up well. The retailer's quarterly sales fell by less than expected, profit gained 36% year-on-year, exceeding expectations, and gross margin stood at 27.4%. The Group also expects a significant rebound for the last 3 months of the year, and is targeting a profit well above forecasts. This should boost the share price, which has lost almost 13% since the start of the year.
- Williams Sonoma (+16%): The American furniture specialist also reported better-than-expected quarterly earnings, despite a 15.5% drop in sales. The retailer benefited from the normalization of transport costs to improve its gross margin from 41.5% to 44.4%. However, it remains cautious about its annual outlook, pointing to "persistent consumer hesitation".
- Tencent Music Entertainment (+15%): The Nyse-listed Chinese music streaming company, little sister of Internet giant Tencent, reported quarterly revenues down 11% but ahead of expectations, and net income up 15.6%, buoyed by steady growth in paid subscriptions. In the wake of this, JPMorgan raised its recommendation and price target on the stock.
Losers:
- Sea Limited (-17%): The US-listed Asian online gaming, e-commerce and digital payment company reported a surprise quarterly loss, which alerted investors to its financial discipline. The company's management went further, announcing investments to gain market share, probably at the expense of profitability. Nevertheless, sales were up 4.9%, better than expected, and adjusted earnings improved.
- Cisco Systems (-9%): The tech group did not disappoint in the latest quarter, with revenues and adjusted earnings up and ahead of expectations. But the company lowered its annual sales and earnings forecasts, due to a slowdown in demand for its networking equipment. It forecasts annual revenues of $53.8 to $55 billion, compared with analysts' expectations of $57.89 billion.
- Entain (-8%): While the British online gaming and betting group published its results two weeks ago, and unveiled a 7% increase in net gaming revenue in the third quarter of 2023, the share price has fallen as analysts have changed their recommendations: Berenberg has reduced its target price and Exane BNP has downgraded its recommendation on the stock.
- Burberry (-7%): The British luxury goods group is sanctioned for a warning on its annual results for the current financial year. The company says it is unlikely to meet its annual revenue targets in the context of slowing demand for high-end products.
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