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Nestle SA has lowered its medium-term profitability target, now aiming for a trading operating margin of 17%, down from the previous goal of 17.5% to 18.5%. The company also announced plans to spin off its water business into a standalone entity as new CEO Laurent Freixe addresses the slowest growth in decades. Sales are expected to rise by 4% or more in a normal operating environment, contrasting with the mid-single-digit growth forecasted for 2025.
The SMI index has turned negative, influenced by Nestlé"s performance, while Kuros sees significant gains. The DAX is expected to open higher, following a stable close at 19,189 points, amid reduced political uncertainty. Key earnings reports from Thyssenkrupp and Rheinmetall are anticipated.
The global consumer healthcare market is segmented by product types, including OTC pharmaceuticals, personal care products, and dietary supplements, with offline distribution channels expected to dominate. North America is projected to lead the market due to rising awareness of wellness products, while Asia Pacific is anticipated to grow rapidly, driven by increasing disposable incomes and a large elderly population. Key players include Johnson & Johnson, Procter and Gamble, and Pfizer, among others, with ongoing developments enhancing market dynamics.
Swiss stocks are experiencing a lack of direction, with Lonza, Richemont, Swiss Re, and Nestlé seeing increased demand. In Japan, share prices are pressured by the appointment of an anti-vaccination campaigner to a key health position, significantly impacting pharmaceutical stocks, particularly Chugai Pharmaceutical, which dropped 8.56%. Equity strategist Kazuo Kamitani suggests ongoing market turbulence, exacerbated by a strong yen affecting export-oriented carmakers.
A total of 224 Swiss companies have committed to CO2 reduction targets aligned with the Paris Climate Agreement by joining the Science Based Targets initiative (SBTi). This includes major corporations like ABB, Givaudan, and Nestlé, with over 80 new members since the start of the year. Only three companies have withdrawn from the initiative.
The Swiss stock market remains in a bearish trend, with the SMI Guiding Values Index down 1.08% to 8174.97 points, influenced by concerns over potential U.S. interest rate hikes. Major banks like UBS and Credit Suisse faced significant losses, while defensive stocks like Nestlé and Novartis attempted to mitigate the downturn. Kudelski saw a positive turn with a court victory against China's Gotech, while Adienne announced plans to enter the stock market without further details.
The Swiss stock exchange closed lower, with the SMI down 0.70% at 8206.20 points, following concerns over potential U.S. interest rate hikes. Major banks like UBS and Credit Suisse faced significant losses, while defensive stocks like Nestlé and Novartis attempted to mitigate the downturn. Market experts anticipate a turbulent period ahead after recent volatility in U.S. markets.
UBS has maintained a "Neutral" rating for Nestlé, setting a price target of 83 francs, as the company prepares for its capital markets day. Analyst Guillaume Delmas highlighted the need for Nestlé to enhance growth, cut underperforming sectors, and focus on innovation and sustainability.Currently, Nestlé shares are trading at CHF 78.56, reflecting a 0.2% decline and a 16.8% drop since the start of 2024, with a potential upside of 5.65% relative to the target. The company is set to release its Q4 2024 earnings on February 13, 2025.
Nestlé S.A., the world"s leading food group, has a diverse product portfolio with significant sales in powdered and liquid beverages (26.7%), pet food (20.3%), and pharmaceutical, nutrition, and wellness products (16.4%). Geographically, the company generates 35% of its sales from the United States and Canada, with notable contributions from Asia and Oceania (21.4%) and Latin America (13.7%).
UBS has rated Nestlé S.A. as 'Neutral' with a target price of 83 francs. As the largest food group globally, Nestlé's sales are diversified across various sectors, including beverages (26.7%), pet food (20.3%), and pharmaceuticals (16.4%), with significant market presence in the USA and Canada (35%).
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