The Swatch Group (UHR) AI Stock Analysis

• Market Cap: CHF9.14B
• Dividend Yield: 2.67%
• Average Volume (3M): 132.60K
• Price to Earnings (P/E): 3084.8
• Beta (1Y): 1.09
• Revenue Growth: -13.19%
• EPS Growth: -88.43%
• Country: CH
• Employees: 32,477
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Luxury Goods
• EPS (TTM): 0.06
• Shares Outstanding: 28,936,000
• 10 Day Avg. Volume: 156,151
• 30 Day Avg. Volume: 132,603
• PEG Ratio: -29.57
• Price to Book (P/B): 0.76
• Price to Sales (P/S): 1.39
• P/FCF Ratio: 89.11
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: CHF136.86
• Price Target Upside: -23.24% Downside
• Rating Consensus: Strong Sell
• Number of Analyst Covering: 7
• EPS Forecast (FY): 4.7
• Revenue Forecast (FY): CHF6.38B

• Rating: 58 Neutral
• Price Target: CHF186.00 ▲(4.32% Upside)
• Action: Reiterated Date: 02/03/26
• Date: Action: Reiterated 02/03/26

The score is held back primarily by weak recent financial performance (revenue declines and profitability compression to near break-even), partially offset by a very strong low-debt balance sheet. Technicals are moderately positive, but an extremely high P/E keeps the valuation component weak despite a ~2.5% dividend yield.

Positive Factors

Conservative balance sheet

Extremely low leverage materially lowers solvency risk and provides durable financial flexibility. Over 2–6 months this supports capital allocation optionality — funding operations, R&D, brand investment, or opportunistic M&A — and cushions the firm through cyclical weakness in luxury demand.

Diversified brand and manufacturing portfolio

A broad portfolio across price points plus vertical integration into movements/components spreads demand risk and sustains revenue ability across cycles. Manufacturing capabilities give pricing control and aftermarket/customer lock-in, supporting durable competitive advantage and margin resilience.

High product gross margins

Very high gross margins reflect strong brand pricing power and low incremental cost of goods sold. This structural margin cushion allows the company to absorb marketing or distribution investments and leaves room to restore operating profit if top-line stabilizes, supporting long-term profitability.

Negative Factors

Sustained revenue decline

Consecutive annual revenue declines indicate weakening demand or loss of market share, which erodes operating leverage and scale benefits. Over the medium term this makes margin recovery harder, pressures fixed-cost absorption, and increases reliance on structural strategic fixes to reinstate growth.

Profitability compression to near break-even

A collapse to near-zero net margin and steep EPS decline signal deep operating stress. This reduces internal funding for reinvestment and heightens execution risk on turnaround plans. Persistently compressed profitability would limit strategic options and strain long-term shareholder returns.

Inconsistent free cash flow

Volatile free cash flow undermines reliable capacity to fund capex, pay dividends, or pursue M&A. Even with positive operating cash flow, irregular FCF complicates capital allocation and increases sensitivity to earnings variability, constraining durable investment and shareholder return programs.

The Swatch Group Business Overview & Revenue Model

Company Description

The Swatch Group AG designs, manufactures, and sells finished watches, jewelry, and watch movements and components worldwide. It operates through Watches & Jewelry and Electronic Systems segments. The Watches & Jewelry segment designs, produces, and commercializes watches and jewelry. The Electronic Systems segment is involved in the design, production, and commercialization of electronic components, as well as sports timing activities. It is also involved in the provision of assembly, research and development, administration, watch case polishing, logistics and distribution, and customer services; and hard material products, microelectronics, watch cases and crowns, miniature low-frequency quartz crystals, thin wires, miniature batteries, watch dials and bracelets, watch hands, sports timing technology and equipment, precision parts, and assembly electronic components. In addition, the company engages in retail, communication, real estate project and property management, finance, reinsurance, and art center businesses. It offers its watch and jewelry products primarily under the Breguet, Harry Winston, Blancpain, Glashütte Original, Jaquet Droz, Léon Hatot, Omega, Longines, Rado, Union Glashütte, Tissot, Balmain, Certina, Mido, Hamilton, Calvin Klein, Swatch, and Flik Flak brands. The Swatch Group AG was founded in 1983 and is headquartered in Biel/Bienne, Switzerland.

How the Company Makes Money

The Swatch Group generates revenue primarily through the sale of watches and related products across its diverse brand portfolio. Its key revenue streams include sales from luxury watches, mid-range timepieces, and entry-level watches, which cater to a wide demographic. The company also earns income from the sale of watch movements and components to third-party brands, bolstering its position in the watchmaking supply chain. Significant partnerships with retailers and e-commerce platforms enhance its market reach. Additionally, The Swatch Group invests in marketing and branding efforts to maintain its strong market presence, which contributes to customer loyalty and repeat purchases. The introduction of smartwatches further diversifies its offerings and revenue potential in the evolving tech landscape.

The Swatch Group Financial Statement Overview

Summary

Financial profile is mixed: an exceptionally conservative balance sheet (minimal leverage) supports resilience, but income performance is weak with two years of revenue declines and a sharp drop in profitability to near break-even in 2025. Cash flow is positive but free cash flow has been inconsistent.

Income Statement

Revenue has been declining for two consecutive years (2024 and 2025), and profitability has deteriorated sharply. 2025 shows near break-even results (net margin ~0.05%) versus healthy profitability in 2021–2023 (net margins ~10–11%). While gross margin remains very high in 2023–2025 (~80%+), operating profitability has been volatile and compressed materially, indicating cost pressure and weaker operating leverage.

Balance Sheet

The balance sheet is exceptionally conservative: debt is minimal (debt-to-equity consistently near zero), and equity is large relative to the asset base. Even with the 2025 earnings slump, leverage remains extremely low, which materially reduces solvency risk and provides flexibility to absorb cyclical weakness in luxury demand.

Cash Flow

Operating cash flow remains positive across the period and improved in 2025 versus 2024, but free cash flow has been inconsistent. Free cash flow turned negative in 2023 and 2024, then recovered to a small positive level in 2025, yet 2025 free cash flow fell sharply versus the prior year’s level (growth rate deeply negative). Cash generation is therefore adequate but not reliably translating into consistently strong free cash flow.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	6.28B	6.74B	7.89B	7.50B	7.31B
Gross Profit	5.16B	5.60B	6.71B	6.19B	5.81B
EBITDA	558.00M	676.00M	1.54B	1.53B	1.42B
Net Income	3.00M	193.00M	869.00M	807.00M	765.00M
Balance Sheet
Total Assets	13.38B	13.99B	14.23B	13.89B	13.68B
Cash, Cash Equivalents and Short-Term Investments	1.23B	1.40B	2.05B	2.55B	2.66B
Total Debt	38.00M	13.00M	75.00M	6.00M	99.00M
Total Liabilities	1.72B	1.77B	1.97B	1.84B	2.07B
Stockholders Equity	11.56B	12.11B	12.20B	11.98B	11.54B
Cash Flow
Free Cash Flow	98.00M	-216.00M	-170.00M	325.00M	995.00M
Operating Cash Flow	507.00M	333.00M	615.00M	724.00M	1.30B
Investing Cash Flow	-346.00M	-470.00M	-768.00M	-114.00M	-727.00M
Financing Cash Flow	-205.00M	-410.00M	-327.00M	-300.00M	-234.00M

The Swatch Group Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 178.30
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CH:UHR, the sentiment is Neutral. The current price of 178.3 is below the 20-day moving average (MA) of 195.15, below the 50-day MA of 180.89, and above the 200-day MA of 158.06, indicating a neutral trend. The MACD of 2.85 indicates Positive momentum. The RSI at 38.22 is Neutral, neither overbought nor oversold. The STOCH value of 16.04 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CH:UHR.

The Swatch Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CFR	78 Outperform	CHF83.47B	21.69	―	1.76%	5.10%	206.55%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
UHR	58 Neutral	CHF9.14B	3,084.78	0.49%	2.67%	-13.19%	-88.43%