Watches Of Switzerland Group PLC shares declined 2.4% in today’s trading session to 691p after a Bloomberg report indicated the luxury watch retailer is set to drop its long-term target to more than double sales and profits by 2028 - a plan that included a £3 billion revenue milestone. Earlier in the day the stock had plunged as much as 7% on the same report.
The decision to discontinue the 2028 growth ambition represented a significant hit to investor confidence because those targets had been central to the company’s equity case since the long-range plan was first disclosed in late 2023. Market participants had been valuing the shares with an expectation that the company could deliver the accelerated expansion outlined in that plan.
Analysts had pointed to persistent shortfalls against the pace of growth required to hit the 2028 figures, and had highlighted that the company was tracking hundreds of millions of pounds short of its stated ambition. In particular, UK revenue growth was described as anaemic, while the broader luxury watch market continued to work through a post-pandemic demand hangover. The stock’s intraday trough at 625p - materially below the 52-week high of 734p - illustrated the extent to which the recent re-rating of the shares depended on confidence in the long-term targets.
Wider market movements provided little support for the shares. The FTSE 100 had closed up 0.71% in the previous session and was trading in a tight range today, indicating that WOSG’s sharp underperformance was driven by company-specific developments rather than broad macroeconomic weakness. Other players in the European luxury goods sector have also faced headwinds, with the segment underperforming broader equity indices year-to-date amid softer consumer demand.
Investors reacted strongly to the possibility of a formal strategy reset coming just weeks before the company’s scheduled full-year results. That timing intensified selling pressure as shareholders reassessed the valuation premium that had been supported by the company’s growth narrative. The share price swung from an opening level of 694.5p down to 625p before partially recovering to 691p, underscoring the heightened uncertainty around the retailer’s medium-term earnings trajectory.
For investors and analysts alike, the development forces a re-evaluation of the assumptions embedded in WOSG’s valuation - particularly those related to execution of growth initiatives, geographic revenue strength, and the speed of recovery in luxury watch demand. The forthcoming full-year results will be watched closely for clarity on how management intends to recalibrate strategy and guidance if the 2028 targets are formally set aside.
Key points
- WOSG shares fell 2.4% to 691p after reports the company will abandon its 2028 growth targets, having earlier dropped as much as 7%.
- The intraday low of 625p contrasts with a 52-week high of 734p, reflecting the reliance of the stock’s rerating on the now-abandoned targets.
- Company-specific news, not broader market weakness - the FTSE 100 was stable - was the main driver of the underperformance; luxury goods peers are facing a soft demand environment.
Risks and uncertainties
- Uncertainty over medium-term earnings trajectory if the 2028 targets are formally withdrawn - impacts investor sentiment in luxury retail and related equities.
- Continued anaemic UK revenue growth and lagging recovery in luxury watch demand could pressure sector valuations and peer comparisons.
- Timing of a strategic reset just weeks ahead of full-year results increases the risk of further share-price volatility.