My previous analysis of Hennes & Mauritz (HM-B) during Q2, I implied that a surge of 25% a few consecutive quarters, would reverse its stock price back to 182.
Although, the stock has not reached 182 - yet, there has been momentum and a surge from its low back in April (126) to its current price at 163.28 SEK, a rough 29% gain.
HM has struggled with fierce e-commerce competition the last years, as it hasn't been able to transition into the changing technological landscape of a viable online-platform, compared to its success with physical stores.
The last decade has seen a tremendous growth in tech-stocks, with a special emphasis on the FAANG-stocks. FAANG is arguably a totally different sector, but it bears relevance in portraying and demonstrating the changing landscape of consumer habits and the increasing importance of an existing online-presence of retail.
Increases in global-internet-connectivity and the advent of smartphones (R.I.P - Steve Jobs*) has caused a disruptive force in traditional retailing, which H&M used to dominate.
Global internet-connectivity is projected to increase to 58% of the global population in 2021, according to data from Cisco.
H&Ms stock has definately risen and has probably more room to the upside, as it has changed and understood the importance of an online-presence, which in practically means a functioning online-site.
If one were to scroll on their site as of today, one'd see that they offer express deliveries, buy online & return in store. Features that have been inspired by the American tech-titans such as Amazon.
H&M themselves wrote in their last Q3 communique;
"Online and physical stores are being increasingly integrated, while in parallel the rollout of online to all existing store markets as well as to other markets continues at full speed."
In the light of the ongoing digitalization we're seeing on a global scale, with both increased internet-connectivity as well as the convenient smartphone-experience in your hand, H&M stands strong and adaptive to the ongoing rapid changes in consumer habits on a global level.
On an insider-level, Stefan Persson, main shareholder and chairman of H&M has since April continued purchasing his shares in H&M, as seen by statistics from the Swedish Financial Authority.
February - April
April-November
Therefore, its stock is poised to rise further, with my projection of 182 SEK for the consecutive quarters (Q4 2018, Q1 & Q2 2019*).