Amplifon faces a sell-off following its results; the market had been hoping for an upward revision to the guidance

(Il Sole 24 Ore Radiocor) - A wave of selling hit Amplifon following the release of its third-quarter results. Shares in the hearing aid company have slipped to the bottom of the FTSE MIB after reporting results broadly in line with expectations the previous day, with organic quarterly growth of 3.6 per cent, fairly evenly distributed across the three regions, and a marked improvement in profitability. Specifically, the group closed the first nine months of the year with consolidated revenue up 0.9% to €1.76 billion, mainly thanks to strong organic growth (+3.5%), and an adjusted net profit of €128.2 million, up 16.9 per cent, with the margin as a percentage of revenue rising by 100 basis points.

Adjusted EBITDA for the nine-month period amounted to 412.8 million (+4.5 per cent), with the margin at 23.4 per cent, up 80 basis points, whilst adjusted EBIT stood at 222 million, (+11.5%) with a margin of 12.6 per cent, up 120 basis points. Adjusted free cash flow as at 30 September is expected to rise by 138.6 per cent to 79.1 million, following Capex investments of 64.3 million, whilst pro-forma net financial debt (excluding net proceeds from the capital increase for the acquisition of GN Hearing) stands at 1.05 billion, compared with 1.045 billion as at 31 December 2025, following investments (Capex and dividends) of 128.1 million, with financial leverage improving to 1.85x as at 30 September 2026. The company has also confirmed its 2026 guidance, which forecasts global market demand to grow by around 3 per cent compared with 2025; performance outpacing the reference market in key countries – with a further increase in market share – and a significant improvement in organic growth, exceeding +3% compared with 2025; a material increase in the adjusted EBITDA margin of around 100 basis points.

For Intermonte, the results are ‘broadly in line with expectations’ and, as a result, the analysts are confirming the target price of 16 euros and their positive view on the share “against the backdrop of accelerating organic growth”, “interesting value creation in the medium term from Gn Hearing” and “a valuation that remains attractive compared with its main integrated peers”. As regards guidance, “whilst the more pessimistic investors might focus on the failure to revise guidance upwards, we appreciate management’s more cautious approach and believe that consistent delivery on targets, as seen in the last two quarters, will help rebuild investor confidence in the group’s ability to execute’, comment the analysts at J.P. Morgan.

“The third quarter presents a mixed picture: both organic sales growth and adjusted EBITDA came in below expectations, whilst adjusted net profit was 4 per cent higher than the consensus, partly offsetting the shortfall”, note the experts at Jefferies, who nevertheless emphasise that “the performance reflects balanced growth across regions, despite a more challenging year-on-year comparison, operational leverage and the unquantified contribution of the Fit4Growth programme to margin improvement”. Analysts had expected a ‘low single-digit/mid single-digit’ decline, i.e. generally around 5–6 per cent. The share price, however, fell by over 13 per cent, but it should be noted that over the past month, Amplifon has risen by around 13% on the stock market (also driven upwards by the increase in 2026 targets set by competitor Demant) and by over 34% in six months, making profit-taking more likely at this stage.

“Although the difference between sell-in and sell-out growth rates was discussed at length during the conference call (with the latter accelerating thanks to new product launches by manufacturers), we believe that the confirmation of the guidance may reassure investors”, write analysts at the Royal Bank of Canada. “The investment thesis continues to hinge on regulatory approvals for the acquisition of Gn Hearing and the integration process following the completion of the transaction,” note the analysts, who emphasise that ‘with organic growth of 3.5 per cent in the first nine months and an 80-basis-point improvement in margins, the pace of revenue growth appears consistent with achieving the full-year target’. On the margins front, however, “a further significant improvement will be required in the fourth quarter. Management has not provided any guidance on the reasons behind this expected acceleration”.