Advertising. During the lockdown phase, the corona crisis led to a surge in online orders and could change the purchasing behavior of many consumers in the long term. While the shopping experience in classic branch shops remains clouded by the requirement to wear a mask, formerly loyal offline buyers have also learned to appreciate orders at the click of a mouse. These developments give Zalando a new boost. In the first quarter of the current financial year, the number of active customers on the fashion platform increased by 17.2 percent compared to the previous year to 31.9 million. The sales of the internet retailer grew by 10.6 percent to a good 1.5 billion euros. Before the wave of customer orders could be anticipated, management even assumed that sales would decrease in 2020.
For the second quarter, the group has now promised significant increases in sales and operating earnings. Analysts were pleasantly surprised and subsequently raised their price targets sharply. In the past, average expectations with sales growth of 16 percent and an adjusted operating profit (EBIT) of EUR 104 million were only slightly above the previous year’s figure (EUR 102 million). But the Zalando management is now assuming significantly higher growth rates. In addition to the changed shopping behavior of customers, one benefits from the implementation of the platform strategy. Here Zalando follows his great role models from the USA. As a result, the Berlin online retailer’s range of shoes and clothing has also expanded to include cosmetics and accessories. High-margin brand manufacturers use the platform’s distribution channel and stationary retailers can also offer their products through Zalando’s partner program.
In the first three months of the current year, the MDAX® group had to accept an operating loss despite the growth in customers and sales. Adjusted EBIT was EUR -98.6 million due to special depreciation on the inventory and weak demand in some cases. Due to the good business from April, there should not be much of it in the full year. The management is targeting an operating profit of between EUR 100 and 200 million after EUR 225 million in the previous year. Sales should increase by 10 to 20 percent compared to the previous year’s figure of 6.5 billion euros.
The Zalando share also suffered strong setbacks during the general market slump this spring. In the meantime, however, the price losses have been made up and the prices have even reached new record levels. As a result, the implied volatilities have decreased. As a growth stock in a generally nervous stock market environment, the Zalando share continues to offer a level of volatility that enables investment alternatives such as DuoRendite Reverse Convertible Bonds with fast partial repayment.
Three times 3.25 percent p.a. Fixed interest rate and market risk only for half the nominal amount
The DekaBank 3.25% Zalando DuoRendite Reverse Convertible 08/2023 (WKN DK0XMB) pays 3.25 percent interest based on the nominal amount of EUR 1,000 after one year. At the same time, the investor gets back half of the nominal amount (EUR 500.00) regardless of the market. The remaining nominal amount (EUR 500.00) will continue to bear interest of 3.25 percent in the following two periods and will also be paid back in full if the Zalando share for the final valuation on August 4, 2023 is at least equal to the base price (80.00 percent of the Starting value) closes.
Otherwise, there is a risk of repayment losses because, instead of the second half of the nominal amount, Zalando shares with a reduced value are transferred to the investor at 80 percent of the starting value. As with any bond, the issuer risk must also be taken into account. This means that, in particular if DekaBank were insolvent, there would be a risk of loss or even a total loss.
The subscription runs from July 20, 2020 to August 7, 2020, subject to an extension or shortening.
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Disclaimer: The information contained herein does not constitute a recommendation to buy or sell the financial instrument and cannot replace individual advice. This promotional information does not contain all relevant information about this financial instrument. Before making an investment decision in certificates, potential investors are advised to read the prospectus in order to fully understand the potential risks and opportunities of the investment decision. Approval of the prospectus by the competent authority should not be understood as an endorsement of the securities offered. The securities prospectus and any supplements can be found at https://www.deka.de/deka-gruppe/wertpapierprospekte under the tab “EPIHS-II-20”, the final conditions under https://mmscache.deka.de/DE000DK0XMB7_FT.pdf can be downloaded. All securities information and the current basic information sheet are also available from your Sparkasse or DekaBank Deutsche Girozentrale (www.deka.de)), 60625 Frankfurt available free of charge. You are about to purchase a product that is not easy and can be difficult to understand.
If courses / prices are mentioned, these are subject to change and do not serve as an indication of tradable courses / prices. The values mentioned here serve to explain the payment profile of this financial instrument. The values are not a reliable indicator of future performance.
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Rating from 25.09.2019, more information at www.deka.de/privatkunden/auszeichen/scope-zertifikate-management-rating
As head of the Deka Group’s Private Banking, Product Management and Product Sales unit, Hussam Masri is responsible for the product development and product management of mutual funds, asset management and pension products, certificates and private banking.