H&M’s Current Growth Rate Won’t Save It From A Profitability Pickle
by MR Magazine Staff
Mar 23, 2016
New H&M locations have steadily opened across the globe for years, but the company is still staring down the possibility its profits could decline into a tailspin, say analysts at Morgan Stanley. In a report out this month, the investment bank questions sales performance at the Swedish retailer, specifically the amount of money it brings in for every square meter of store space it operates. The chain continues to open new stores at about the same 15% rate, but profits aren’t following, the analysts said. “We think a mathematical tipping point is approaching, and there is a risk that profits fall sharply by 2020,” the report states. By sharply, they mean as much as 40%. Read more at Quartz.
