Samsonite Rises 3% Despite 1Q Profit Drop and Target Price Cuts

Samsonite International S.A. (01910.HK) saw its shares rise after reporting a 33.2 percent drop in first-quarter net profit and announcing a new $50 million share buyback plan.

"The group guided for low single-digit revenue growth for FY2026 and expected margins to gradually improve from the 1Q26 level, which was better than market concerns," UBS said in a research note following the announcement.

The luggage maker's net profit for the quarter ended in March fell to $32.2 million from the same period a year earlier. Revenue rose 4.1 percent to $829 million, but adjusted EBITDA of $109 million was down 15 percent year-over-year and missed market expectations, prompting several analysts to lower forecasts.

Despite the earnings miss, shares gained 2.85 percent to close at HK$14.08 in Hong Kong. Analysts, while trimming price targets, saw value in the company's recovery prospects. CICC's new target of HK$20, for instance, still implies 46 percent upside from the current price.

Analysts Trim Targets on Cost Pressures

Multiple investment banks adjusted their outlook on Samsonite following the results.

CICC maintained its "Outperform" rating but cut its target price by 17 percent to HK$20, lowering its 2026 and 2027 net profit forecasts due to higher-than-expected cost pressures.
UBS reiterated a "Buy" rating while reducing its price target to HK$20.6 from HK$22.7, noting that higher administrative expenses weighed on margins.
HSBC Global Research also kept a "Buy" rating but lowered its target to HK$19 from HK$24, pointing to a challenging near-term outlook from the Middle East conflict and its impact on travel trends.

Company management attributed margin pressure to rising prices for plastics and aluminum, which account for a significant portion of material costs, alongside increased transportation fees.

Outlook and Strategic Moves

Samsonite's management guided for low single-digit sales growth for the full year 2026, expecting trends to improve in the second half, assuming no further escalation of conflicts in the Middle East. The company also stated it is continuing preparations for a potential dual listing in the United States, maintaining a target to complete the process in 2026.

The positive stock reaction suggests investors are focusing on the share buyback and potential second-half recovery over the weak first-quarter results. The successful completion of its planned US dual listing in 2026 remains a key catalyst for the stock.

This article is for informational purposes only and does not constitute investment advice.