Market's view on Watches Switz

Published on April 2024

  • A stock watcher hypothesises that many UK listed companies including WOSG may be vulnerable to takeover bids, as they appear undervalued with a market cap of £1.9 billion against a target of £3 billion sales by 2028.

  • Goldman Sachs has upgraded Watches of Switzerland to a strong buy with a price target of £5.50.

  • A stock watcher observes potential sector consolidation, citing BHP’s offer for AAL and suggesting that it might be an opportune time for acquisitions while share prices are low.

  • A discussion is made about the affordability of WOSG, mentioning an ambitious plan to double turnover and EBITDA over four years, with a note that the share price is forming a potential double bottom.

  • Comments are made expressing skepticism about the value of long waiting lists for high-end watches compared to other investments, like stab-proof vests in London due to safety concerns.

  • Mention is made of the geographical distribution of shops being primarily in the UK, Europe, and the US, which could influence business stability or growth.

  • Market cap comparisons suggest WOSG is significantly undervalued, being half its revenue, and listed as a potential takeover in financial news.

  • A stock watcher argues that luxury watches are a better or equal investment compared to physical gold, noting minimal depreciation and ease of sale.

  • A contrasting viewpoint is presented, criticising the idea that luxury watches are a good investment, highlighting large margins for dealers and significant price depreciation after purchase.

  • The growing wealth of the rich and sustained demand for luxury watches likely will stabilise prices, suggesting a favourable future for luxury watch retailers.

  • Directors of a company are noted to hold a significant amount of shares, bought at higher prices, making a bid plausible, and the P/E ratio reaching 6.5 indicates a potentially excellent long-term hold.

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