March 17th, 2021 | 09:09 CET
Lufthansa, H&M, Metro, RYU - Just before take-off!
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Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.
Lufthansa - Mallorca bookings go through the roof
Some bombshell news before Easter: Mallorca is no longer a risk area! Thanks to a progressive approach of the RKI, travel to Mallorca is allowed without restrictions if vacationers get tested. Lufthansa recorded a jump in bookings within 48 hours. Within the last 2 weeks, 80% more bookings have been received for Mallorca. The plus is 20% for the Canary Islands as the risk situation is apparently under control here too.
All in all, flight destinations in Spain, in particular, are now in high demand. Against this background, Lufthansa increased numerous capacities; for Mallorca, instead of 2 weekly flights from Munich, the Company will offer up to 11 connections in the future. The Lufthansa subsidiary Eurowings speaks of bookings in an unprecedented dynamic. The bottom line is that Mallorca is now twice as popular as in 2019. One can only hope not to pull here the next hotspot like Ischgl. Why, against this background, the German hotels are rewarded with lockdown is probably incomprehensible to all, but in Mallorca, perhaps it is much easier to comply with the safety rules - the German hoteliers are deprived of this concession. So is politics!
The increase in the Lufthansa share price in one month is 11.8% percent. However, at levels above EUR 12, the air becomes thin because here, the profits of the years 2023 to 2026 are probably already valued.
H&M - Temporary store openings give hope
Things could have gone better for H&M! Due to the many store closures, H&M has once again had a tough quarter. Nevertheless, the Swedish clothing giant saw more minor signs of recovery in the first half of March. In the first quarter of the broken fiscal year (from Dec. 1 to Feb. 28), H&M's sales fell by a noticeable 27% to SEK 40.1 billion (equivalent to about EUR 3.94 billion). With these results, the group did slightly better than analysts expected. Still, a sign of despair nevertheless remained, as the sales level of 2019 is receding into the distant future and warehouses are accordingly full. H&M, like all other retailers, needs a resurgence of consumer sentiment both on-site and online.
At its peak, more than 1,800 stores were closed due to the Covid-19 situation. There are still 1,300 locations that cannot open. E-commerce continues to perform very well, but only to the extent possible. Meanwhile, Germany, H&M's primary market, and some other countries have eased Covid restrictions, leaving about 900 H&M stores still closed as of Mar. 13. According to the fashion company, the small opening step had an immediate impact on sales, which rose 10% year-over-year between Mar. 1 and Mar. 13. That is notable.
The H&M share has now turned 3 times upwards in the EUR 11-12 zone, and the value currently stands at EUR 22 - which means that the March crash has been completely leveled out.
Metro - Better positioning stabilizes the balance sheet
From H&M, we take a look at Metro. In contrast to most retail businesses, Metro has the good fortune to have a pronounced area supply with food, although 60% of the goods represent a pure non-food offer. At the last AGM, it was also possible to look forward with hope from this perspective. 2020 was a special year, but Metro has evolved with its clientele. The Company introduced special merchandise for restaurateurs offering take-away. As a result, Metro made slight gains in market share and recovered quickly from the effects of the 1st lockdown. With the lifting of the 2nd lockdown, the Company expects an early and substantial recovery of the beleaguered foodservice customers.
With this hope, the food wholesaler reaffirmed its targets for the full year ending Sept. 30 and expects a substantial improvement in the figures for 2021/22. Investments and resources expand the delivery business and digitization and have a stronger focus on convenience and regional products in its assortment. Metro shares have overcome the sell-off zone of EUR 7-9 and are stable in the market.
RYU Apparel - Expansion to Europe announced
The Canadian fashion retailer RYU Apparel obviously has a crisis-proof concept because many of its products are already sold out on the website, even though the flagship stores are still closed until mid-April. It is remarkable how RYU has built up an entire fan base in the 14 to 40-year-old segment in a short time. These are the consumer-savvy demographic that have good budgets and are also accessible through all marketing channels.
After its restructuring, RYU has established modern corporate structures and focuses on trendy and unique designs. Recently appointed Chief Operational Officer Rob Blair brings nearly two decades of experience in building high-growth, iconic apparel and sportswear brands to the RYU team. He has worked with sportswear brands such as Red Bull, Lululemon, GAP Body and Nike, an industry expert in design, merchandising, and brand strategy. Part of his concept is also the "digital-first" approach, documenting online strategy primacy over brick-and-mortar sales. The focus is on the customer experience across all channels; RYU is on the verge of becoming a key brand in North America today.
But North America is not the only focus: the first overseas regions RYU is expanding into are the fast-growing markets of Europe and the UK. According to recent market research, sales in the sportswear market are estimated to reach around USD 208 billion by 2025, with Germany accounting for USD 2.3 billion and the rest of Europe USD 1.9 billion. Within the pandemic lie corresponding restrictions on brick-and-mortar stores and improved opportunities in e-commerce. RYU shares have rallied from CAD 0.05 to CAD 0.25 since October 2020 and are now back at CAD 0.14.
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