斯沃琪集团：改善治理的首轮尝试失败，但维权投资者史蒂文·伍德现在着眼于临时股东大会

Swatch Group AG/TheRatingOutperformPrice TargetUHR.SW160.00 CHFAdjusted EPSF24AF25EF26EUHR.SW (CHF)3.713.47Source: Bloomberg, Bernstein estimates and analysis.Swatch Group held its Ordinary General Meeting on Wednesday, 21 May 2025, which includedthe proposal to elect an activist investor — Steven Wood — to the Board of Directors arepresentative of the bearer shareholders.The attempt to elect an activist investor to Swatch Group’s Board of Directors failed.Swatch Group has yet to publish the voting results, but a recent FT article suggests that>60% of bearer shares voted in favor of the activist. The final tally, however, saw 79.2% ofshareholders voting against Steven Wood’s election: bearer shares represent 55% of SwatchGroup’s share capital, but registered shares (predominantly held by individuals linked tothe founding Hayek family) hold 80% of the voting rights — Swatch Group’s statutes here.Swatch Group’s existing Board recommended against voting for Steven Wood, given his lackof Swiss links and involvement in the defense industry. Steven Wood has indicated that he willcontinue pursuing the position, possibly through an extraordinary general meeting.Swatch Group has high potential…The company possesses key tier two brands in theluxury watch space: Omega (established in 1884), Blancpain (1735), and Breguet (1775). Italso holds Harry Winston, a storied jeweller, alongside other watch brands such as Longinesand Tissot.… but is chronically under-managed.An abysmal ROIC track record andidiosyncratic approach to financial markets and corporate management has led SwatchGroup to trade at rock bottom multiples (1x EV/Sales). The industry is currently in the midst ofa prolonged trough after a post-COVID binge (see Global Luxury Goods: March Swiss watchexports — US strength may reflect tariff pull-forward; outlook remains uncertain): lowerpurchase frequency will lead to longer normalization.Our Outperform rating on Swatch Group is an option on transformational M&A as acatalyst to unlocking this value— see Swatch: Is it now a "special situation" investment?and Swatch Group: How a delisting could work).But transformational change ingovernance would also be a step in the right direction, in our view.As the voting resultsshow, Swatch Group’s management team currently has little incentive to pay attentionto ROIC and financial markets. This has come at the cost of both bearerandregisteredshareholders, who still hold 45% of the company’s share capital after all (see our recentpiece analysing industry ROIC: Global Luxury Goods: ROIC normalizes after the post-COVID-19 boom - more pressure expected in FY25E).See the Disclosure Appendix of this report for required disclosures, analyst certifications and otherimportant information. Alternatively, visit our Global Research Disclosure Website.First Published: 22 May 2025 08:32 UTC Completion Date: 22 May 2025 08:32 UTC 1,437.2712001300140015001600 4.07FinancialsF24AF25EF26ECAGRRevenues (M)6,7356,4106,723--F26E36.4Close Date148.25160.008%EDMFYEDecDiv Yield3.0%7,770EV (CHF) (M)6,487Performance12MAbsolute (%)(23.1)EDM (%)10.5Relative (%)(33.7)CHF220CHF200CHF180CHF160CHF14005/24 INVESTMENT IMPLICATIONSWe rate Swatch Group Outperform, PT 160CHF.BERNSTEIN TICKER TABLETickerRatingUHR.SWOCHFEDMO - Outperform, M - Market-Perform, U - Underperform, NR - Not Rated, CS - Coverage SuspendedSource: Bloomberg, Bernstein estimates and analysis.GLOBAL LUXURY GOODS 21 May2025ClosingPrice148.251,437.27 I. REQUIRED DISCLOSURESReferences to "Bernstein" or the “Firm” in these disclosures relate to the following entities: Bernstein Institutional Services LLC(April 1, 2024 onwards), Sanford C. Bernstein & Co., LLC (pre April 1, 2024), Bernstein Autonomous LLP, BSG France S.A. (April 1,2024 onwards), Sanford C. Bernstein (Hong Kong) Limited盛博香港有限公司,C. Bernstein (India) Private Limited (SEBI registration no. INH000006378), Sanford C. Bernstein (Singapore) Private Limited andSanford C. Bernstein Japan KKOn April 1, 2024, Société Générale (SG) and AllianceBernstein, L.P. (AB) completed a transaction that created a new joint venturein which their respective cash equities and research businesses operate in a new business combination. Although their respectiveownership percentages in the joint venture differ between North America and the rest of the world, the creation, production andpublication of research is handled collaboratively on a global basis across the two research brands, “Bernstein” and “Autonomous”.Unless specifically noted otherwise, for purposes of these disclosures, references to Bernstein’s “affiliates” relate to both SG andAB and their respective affiliates.VALUATION METHODOLOGYSwatch Group AG/TheWe now value Swatch Group on 1x EV/Sales, 20% below its 10Y average but largely in-line with its FY24 average, arriving at atarget price of 160 CHFRISKSSwatch Group AG/TheOn the downside:1. Further technical developments in smart watches would continue to eat into Swatch’s entry price brands;2