Pandora Projects 6-9% Organic Growth in 2024, Doubles Share Price

Summary

With an impressive performance over the previous year, attributed to robust sales of silver charms and bracelets, growth is the word at Pandora. The Company has projected an organic revenue escalation of between 6% and 9% come 2024. This projection aligns with the October goal of a 7-9% compound annual growth rate stretching from 2023 to 2026. In related news, Pandora announced a share buyback program worth 4 billion Danish crowns (equivalent to $580 million). However, the company experienced underwhelming sales in China in the last quarter, falling shy of the expected mark. The United States continues to present the most considerable promise as Pandora’s largest market.

Pandora’s Revenue Growth and Market Performance

Pandora’s (OTC:) track record over the past year provides a positive outlook, significantly raising the company’s share price. Due to strong sales of its silver charms and bracelets, the company aims for overall organic revenue growth of 6%-9% in 2024. The growth projected in 2024 aligns with the target set in October for a 7-9% compound annual growth rate from 2023 to 2026. The company also confirmed robust earnings and revenue in the fourth quarter.

Share Buyback Program and Challenges in China

Pandora has also announced a share buyback scheme amounting to 4 billion Danish crowns ($580 million). However, the company fell short of presumed quarterly sales in China, with sales dropping to 116 million crowns from 143 million in the corresponding quarter of the previous year.

Success Amidst Retail Struggles

In an otherwise struggling retail market, Pandora has emerged triumphant, targeting aspiring consumers with affordable luxury offerings. The brand, having sold a staggering 107 million jewelry pieces in 2023, subsequently increased from 103 million in 2022, has extended its bracelet range. Prices for these bracelets start at $60 and go up to over $2000. In addition to this, the brand has consistently opened new stores and migrated from wholesale.

Improvements and Opportunities

Jaime Vazquez de Lapuerta, portfolio manager at Bestinver in Madrid, remarked on Pandora’s significant improvements in marketing and communication strategies. He also alluded to the potential opportunity Pandora has to open more stores in its largest market, the United States. “Even without banking on a potential turnaround in China, one can remain bullish about Pandora,” he added.

Revenue Performance in US and China

In 2023, Pandora’s revenue in the U.S. rose by 2%, amounting to 8.3 billion crowns. China’s revenue, however, slipped by 9%, resulting in 564 million crowns over the year.

($1 = 6.9329 Danish crowns)

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