Beiersdorf Stock: China Strategy Drives Share Growth

Beiersdorf shares climbed significantly by 3.8% to €132.00 on Thursday, though still trading about 10.7% below the 52-week high of €147.80 from May 2024. The surge follows CEO Vincent Warnery's announcement of plans to "put the house in order" in China by 2025, with a strategic launch of four consumer brands featuring the Thiamidol ingredient planned for 2026. Particularly notable is the company's focus on luxury brand La Prairie, which experienced a 6.2% global sales decline last year. Beiersdorf aims to normalize inventory levels in China within six weeks while expanding the brand's customer base to younger consumers. The company reported record sales of nearly €9.9 billion for 2024, representing 6.5% organic growth, with adjusted operating profit increasing by 8% to almost €1.4 billion. Additionally, Beiersdorf announced a share buyback program worth up to €500 million, maintaining its dividend at €1.00 per share.

US Tariffs Threaten Growth Prospects

The incoming US administration's potential import tariffs could significantly impact Beiersdorf's operations. CFO Astrid Hermann warned that with approximately two-thirds of US business being imported-largely from Mexico-a 25% tariff could affect business by up to 50 basis points. The company has already built up US inventory levels and is examining pricing adjustments as protective measures. Despite these challenges, analysts maintain a positive outlook, with an average price target of €144.70, suggesting nearly 10% upside potential.