Safilo soars after results; Akros says it’s a buy and raises its target price

(Il Sole 24 Ore Radiocor) - Solid performance for Safilo Group on the Milan Stock Exchange. On Tuesday 4 August, after markets had closed, the company released its first-half results, which showed revenue of €511.96 million, down by 1.9 per cent at constant exchange rates and by 4.8 per cent at current exchange rates compared with the €537.63 million recorded in the same period of 2025. Conversely, EBITDA improved from €70.2 million to €79.5 million, with the margin rising from 13.1% to 15.5%. Safilo ended the half-year with a net profit of 44.44 million euros, compared with the 41.71 million recorded in the first six months of 2025; adjusted net profit rose to 49.4 million.

According to analysts at Banca Akros, ‘second-quarter sales were in line with estimates’, whilst management highlighted an improvement in market conditions towards the end of June and throughout July, particularly in North America. For brokers, the main positive surprise came from the gross margin, “which stood at 64.7 per cent compared with the estimate of 62.1 per cent (excluding the US tariff refund)”. The result was supported by a favourable product mix and pricing, as well as lower costs related to tariffs, although part of this benefit will be reinvested in advertising and promotion (A&P) activities. In light of the results, analysts have “revised their revenue and gross margin forecasts upwards for the full year 2026, whilst keeping their earnings per share estimate unchanged, as we expect the increased profitability to be partly reinvested. We have also revised our gross margin assumptions for subsequent years upwards, anticipating a normalisation of capital expenditure and an increase in the adjusted EBITDA margin from the estimated 11.4% for 2026 to 12.0% in 2028, rising to 12.5% in 2030.” Consequently, we are raising the target price from €1.70 to €2.20 per share and upgrading our recommendation on the stock to “Buy” from “Neutral”.

Analysts at Equita focus on the conference call held following the release of the financial results: ‘The comments go some way towards alleviating concerns about revenue trends, the main reason for our downgrade in early July; they highlight upside potential in margin estimates thanks to cost-cutting measures, leading us to raise our 2026 EBITDA forecast by 5 per cent to 113 million (margin of 11.6 per cent) and our 2027 forecast by 6 per cent to 120 million euros (margin of 11.8 per cent)’. The analysts have revised their estimates for year-end net debt upwards by 30 million (whilst maintaining the assumption of a 18 million buy-back to be completed by the end of the year), partly due to the repayment of tariffs.” In light of this, analysts have raised “the target price slightly to €2.1, confirming a target multiple of 6.5 times applied to 2027”. The ‘Hold’ rating has been confirmed ‘pending consolidation of the top-line trend, also in light of growing competitive pressure’.