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INDITEX: 2Q’21 RESULTS PREVIEW (ANÁLISIS BANCO SABADELL)

We expect good 2Q’21 results, but this would already be priced in. SELL.
ITX will release its 2Q’21 results on 15 September. We expect revenues to rebound strongly vs. 2020, even improving vs. 2019: +50% in sales vs. 2Q’20 and +3% vs. 2Q’19. Operating leverage and the measures adopted in the last year to reduce costs (especially rental costs) should lead EBIT to grow by +289% vs. 2Q’20 and +14% vs. 2Q’19. Trading at a P/E of 25x on a 12-month horizon compared to the (wide) historical range of 15x-35x , we think the current share price is fairly value, already including a rally in the results, and we do not see upside from current levels. Since 2020 lows the stock has risen +40% (+3% vs. IBEX).