Stockholm - Hennes & Mauritz AB, Europe’s second-biggest clothing retailer, rose to its highest price in 11 months in Stockholm trading after announcing its first store in South Africa and as Barclays upgraded its rating.
H&M shares gained as much as 1.5 percent to 247 kronor, their highest since September 26 last year and steepest increase since August 13 this year. The stock advanced 1.5 percent to 246.9 kronor as of 10.14am local time, with trading volumes at 21 percent of the daily average in the past three months.
The Swedish company has signed a contract for a full- concept flagship store which will open in South Africa in 2015 at the earliest, it said in a statement on Thursday. “We see great potential for further expansion in this region,” Chief Executive Officer Karl-Johan Persson said in the statement.
Barclays on Thursday raised its rating on H&M shares to overweight from equal-weight, saying “investors underestimate H&M’s potential to offer sustainable long-term outperformance in sales growth”.
The bank’s analysis indicates that H&M will accelerate sales growth next year and probably outpace rival Inditex SA, owner of the Zara chain, in the coming decade, Christodoulos Chaviaras, an analyst at Barclays in London, wrote in a note to clients on Thursday. - Bloomberg