Balanced Outlook for Logitech: Manufacturing Agility and Cost Management Amid Tariff and Market Uncertainties

Analyst Didier Scemama of Bank of America Securities reiterated a Hold rating on Logitech (LOGI – Research Report), reducing the price target to CHF65.00.

Didier Scemama’s rating is based on a combination of factors reflecting both positive aspects and potential risks for Logitech. On the positive side, Logitech has demonstrated impressive manufacturing agility, particularly with their “China+5” strategy, which aims to reduce reliance on Chinese production for US sales. This strategy is expected to mitigate tariff impacts and improve product cost efficiency, contributing to margin expansion. Additionally, Logitech’s proactive cost management and positive sell-out trends indicate effective inventory management.
However, there are notable risks that justify the Hold rating. The uncertainty surrounding future tariff costs poses a potential threat to gross margins, as the extent of impact is difficult to predict. Furthermore, Logitech’s recent price increases in the US could dampen consumer demand, and there is cautious sentiment in the B2B sector, particularly in Europe due to market uncertainties. These factors, combined with the current valuation, lead to a balanced outlook, supporting the Hold recommendation.

In another report released on April 24, UBS also maintained a Hold rating on the stock with a CHF88.00 price target.

LOGI’s price has also changed slightly for the past six months – from $82.700 to $75.390, which is a -8.84% drop .