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Inter Parfums' (IPAR) Strategies Poise it for Growth in 2024
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Inter Parfums, Inc. (IPAR - Free Report) is benefiting from the momentum in the fragrance market on the back of an impressive brand portfolio. Focus on effective product launches bodes well. The provider of fragrances and related products is on track to expand its business through new licenses or acquisitions.
Let’s discuss this in detail.
Favorable Market Trends Drive Growth
Inter Parfums appears well-positioned in the booming fragrance market due to its legacy scents and innovative extensions. The company is expanding its market share with innovative programs. These positives collectively boosted the company’s third-quarter 2023 results, with the top and the bottom line increasing year over year and beating the Zacks Consensus Estimate.
Buoyed by a robust momentum in the fragrance space and gains from product newness, the company is set to witness another record year in 2024. For the full-year 2024, the company anticipates net sales of $1.45 billion and earnings of $5.15 per share. This guidance suggests 12% growth in net sales and an 8% improvement in the bottom line from 2023 projections.
Image Source: Zacks Investment Research
Product Launches on Track
Inter Parfums is witnessing increased market share owing to new product launches and brand extensions. The company boasts an impressive pipeline of fragrances planned like a new pillar of launch for GUESS and GUESS Sexy Skin metallic for 2024. Management is on track to launch a new blockbuster fragrance for DKNY during the upcoming summer. Inter Parfums plans to introduce new products for Ferragamo in 2024.
Prudent Partnership: Key Driver
Inter Parfums is on track to expand its business through new licenses or acquisitions. The company entered into an exclusive worldwide fragrance license for the prestigious Roberto Cavalli brand, which became effective on Jul 6, 2023. In December 2022, Inter Parfums’ majority-owned Paris-based subsidiary, Interparfums SA, signed a license agreement with Lacoste — a well-known fashion sports brand.
The company became the exclusive worldwide license for the Donna Karan and DKNY fragrance brands (July 2022) through a deal with G-III Apparel Group. In October 2021, Inter Parfums finalized the agreement with Salvatore Ferragamo S.p.A to hold the exclusive worldwide license for the production and distribution of Salvatore Ferragamo brand perfumes. The company is gaining from its strategic partnerships with Origines-parfums and Moncler SpA.
Will Hurdles be Countered?
Inter Parfums has been grappling with higher SG&A expenses for a while. During the third quarter, SG&A expenses were $147.8 million, up 25.9% from the $117.4 million reported in the year-ago quarter. Management continues to make significant investments in advertising and promotion. The company plans to allocate 21% of its annual net sales to advertising and promotion, reiterating its aggressive approach to drive sell-through. Although such investments are likely to contribute to growth, they might put pressure on profits in the near term.
The aforementioned upsides are likely to keep the company well-positioned for growth in 2024.
The Zacks Rank #3 (Hold) company’s shares have gained 2.3% in the past six months against the industry’s 21.4% decline.
The Zacks Consensus Estimate for e.l.f. Beauty’s current financial year sales and earnings suggest growth of 57.8% and 62.7%, respectively, from the year-ago reported numbers.
Ingredion Incorporated (INGR - Free Report) , which produces and sells sweeteners, starches, nutrition ingredients and biomaterial solutions, holds a Zacks Rank #2. INGR delivered a positive earnings surprise of 23.9% in the last reported quarter.
The Zacks Consensus Estimate for Ingredion Incorporated’s current financial-year sales and earnings suggests growth of around 5% and 24.7%, respectively, from the year-ago reported numbers.
Lamb Weston (LW - Free Report) , which offers frozen potato products, currently carries a Zacks Rank #2. LW delivered an earnings surprise of 3.6% in the last reported quarter.
The Zacks Consensus Estimate for Lamb Weston’s current financial-year sales and earnings implies growth of 28.1% and 26.3%, respectively, from the year-ago reported numbers.
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Inter Parfums' (IPAR) Strategies Poise it for Growth in 2024
Inter Parfums, Inc. (IPAR - Free Report) is benefiting from the momentum in the fragrance market on the back of an impressive brand portfolio. Focus on effective product launches bodes well. The provider of fragrances and related products is on track to expand its business through new licenses or acquisitions.
Let’s discuss this in detail.
Favorable Market Trends Drive Growth
Inter Parfums appears well-positioned in the booming fragrance market due to its legacy scents and innovative extensions. The company is expanding its market share with innovative programs. These positives collectively boosted the company’s third-quarter 2023 results, with the top and the bottom line increasing year over year and beating the Zacks Consensus Estimate.
Buoyed by a robust momentum in the fragrance space and gains from product newness, the company is set to witness another record year in 2024. For the full-year 2024, the company anticipates net sales of $1.45 billion and earnings of $5.15 per share. This guidance suggests 12% growth in net sales and an 8% improvement in the bottom line from 2023 projections.
Image Source: Zacks Investment Research
Product Launches on Track
Inter Parfums is witnessing increased market share owing to new product launches and brand extensions. The company boasts an impressive pipeline of fragrances planned like a new pillar of launch for GUESS and GUESS Sexy Skin metallic for 2024. Management is on track to launch a new blockbuster fragrance for DKNY during the upcoming summer. Inter Parfums plans to introduce new products for Ferragamo in 2024.
Prudent Partnership: Key Driver
Inter Parfums is on track to expand its business through new licenses or acquisitions. The company entered into an exclusive worldwide fragrance license for the prestigious Roberto Cavalli brand, which became effective on Jul 6, 2023. In December 2022, Inter Parfums’ majority-owned Paris-based subsidiary, Interparfums SA, signed a license agreement with Lacoste — a well-known fashion sports brand.
The company became the exclusive worldwide license for the Donna Karan and DKNY fragrance brands (July 2022) through a deal with G-III Apparel Group. In October 2021, Inter Parfums finalized the agreement with Salvatore Ferragamo S.p.A to hold the exclusive worldwide license for the production and distribution of Salvatore Ferragamo brand perfumes. The company is gaining from its strategic partnerships with Origines-parfums and Moncler SpA.
Will Hurdles be Countered?
Inter Parfums has been grappling with higher SG&A expenses for a while. During the third quarter, SG&A expenses were $147.8 million, up 25.9% from the $117.4 million reported in the year-ago quarter. Management continues to make significant investments in advertising and promotion. The company plans to allocate 21% of its annual net sales to advertising and promotion, reiterating its aggressive approach to drive sell-through. Although such investments are likely to contribute to growth, they might put pressure on profits in the near term.
The aforementioned upsides are likely to keep the company well-positioned for growth in 2024.
The Zacks Rank #3 (Hold) company’s shares have gained 2.3% in the past six months against the industry’s 21.4% decline.
Solid Staple Picks
e.l.f. Beauty (ELF - Free Report) carries a Zacks Rank #2 (Buy). ELF has a trailing four-quarter earnings surprise of 90.1%, on average. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for e.l.f. Beauty’s current financial year sales and earnings suggest growth of 57.8% and 62.7%, respectively, from the year-ago reported numbers.
Ingredion Incorporated (INGR - Free Report) , which produces and sells sweeteners, starches, nutrition ingredients and biomaterial solutions, holds a Zacks Rank #2. INGR delivered a positive earnings surprise of 23.9% in the last reported quarter.
The Zacks Consensus Estimate for Ingredion Incorporated’s current financial-year sales and earnings suggests growth of around 5% and 24.7%, respectively, from the year-ago reported numbers.
Lamb Weston (LW - Free Report) , which offers frozen potato products, currently carries a Zacks Rank #2. LW delivered an earnings surprise of 3.6% in the last reported quarter.
The Zacks Consensus Estimate for Lamb Weston’s current financial-year sales and earnings implies growth of 28.1% and 26.3%, respectively, from the year-ago reported numbers.