The Swatch Group AG (UHRN) AI Stock Analysis

• Market Cap: CHF10.07B
• Dividend Yield: 2.61%
• Average Volume (3M): 56.02K
• Price to Earnings (P/E): 664.0
• 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): 0.01
• Shares Outstanding: 116,919,500
• 10 Day Avg. Volume: 89,251
• 30 Day Avg. Volume: 56,025
• 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: CHF200.00
• Price Target Upside: 407.87% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): 0.94
• Revenue Forecast (FY): CHF6.40B

• Rating: 58 Neutral
• Price Target: CHF37.00 ▼(-6.04% Downside)
• Action: Reiterated Date: 02/03/26
• Date: Action: Reiterated 02/03/26

The score is held back primarily by the sharp deterioration in profitability and uneven free-cash-flow generation, despite a very strong balance sheet. Technical indicators are modestly supportive, but a relatively high P/E with only moderate dividend yield keeps valuation from offsetting the weaker operating performance.

Positive Factors

Conservative balance sheet / very low leverage

Extremely low leverage and a large equity base provide durable financial resilience through luxury cycles, enabling investment or buybacks without refinancing stress. This structural strength preserves optionality and reduces bankruptcy risk over the next 2–6 months and beyond.

High and stable gross margins

Very high gross margins reflect strong pricing power and manufacturing economics in watchmaking, supporting long-term profitability if operating leverage is restored. This structural margin cushion helps absorb cost inflation and underpins sustainable margin recovery over several quarters.

Diversified brand portfolio and in‑house manufacturing

A multi-tier brand lineup across luxury to mass-market plus vertical integration in movement/component production creates durable competitive advantage: channels different demand cycles, captures manufacturing margin, and supports long-term brand equity and aftermarket strength.

Negative Factors

Sharp deterioration in operating profitability

Collapse in net and EBIT margins signals structural pressure on operating leverage or cost base. If margins remain depressed, returns on capital and ability to fund strategic initiatives weaken, impairing long-term shareholder returns absent decisive margin-restoration actions.

Volatile and inconsistent free cash flow

Inconsistent FCF undermines reinvestment capacity and makes capital allocation harder to sustain; negative FCF periods heighten reliance on balance-sheet buffers. Persistent volatility limits ability to fund dividends, buybacks, or capex without drawing on reserves.

Recent revenue decline trend

Slowing top-line across consecutive years suggests demand headwinds or market-share pressure. Absent recovery, revenue erosion will constrain margin leverage and cash generation, making margin restoration and return improvement more challenging over the medium term.

The Swatch Group AG 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 AG generates revenue through multiple streams centered around the sale of watches and jewelry. The company's primary revenue source is the retail sales of its wide range of watch brands, which cater to various market segments from luxury to affordable timepieces. Additionally, the company earns revenue from the sale of watch movements and components to third-party brands, leveraging its expertise in manufacturing. The Swatch Group also benefits from licensing agreements for certain brands and collaborations with fashion or technology partners. Seasonal promotions and limited edition releases further enhance its revenue potential. The company's strong global distribution network and e-commerce platform have become increasingly important, especially in reaching younger consumers and adapting to changing market dynamics.

The Swatch Group AG Financial Statement Overview

Summary

Overall fundamentals are mixed: a very strong, low-leverage balance sheet (Score 88) is offset by sharply weaker profitability (Income Statement Score 42 with net margin falling to near breakeven and EBIT margin compressing) and inconsistent free cash flow (Cash Flow Score 46 with negative FCF in 2023–2024 and only modestly positive in 2025).

Income Statement

Profitability has deteriorated sharply: net profit margin fell from ~11% (2022–2023) to ~2.9% in 2024 and near breakeven in 2025 (annual), with EBIT margin also compressing to ~2.1% in 2025. Revenue has also been trending down recently (down ~0.1% in 2024 and ~1.1% in 2025), versus growth in 2021–2023. A key strength is consistently very high gross margin (~78–83%), but weak operating leverage and the steep earnings decline materially weigh on the score.

Balance Sheet

The balance sheet is conservatively positioned with extremely low leverage (debt-to-equity consistently ~0.1%–0.9%), and equity is large relative to total assets. This provides resilience for a cyclical luxury environment. The main weakness is returns collapsing alongside earnings: return on equity dropped from ~6–7% (2021–2023) to ~1.6% in 2024 and ~0.03% in 2025, signaling that the strong capital base is currently not generating attractive shareholder returns.

Cash Flow

Operating cash flow remains positive across all years provided (about 507M in 2025 vs 333M in 2024), supporting liquidity. However, free cash flow has been volatile and often negative (negative in 2023 and 2024), with only modestly positive free cash flow in 2025 (98M) and a very large year-over-year decline in the provided growth figure. Cash generation quality is mixed, with free cash flow not consistently tracking earnings and periods of cash outflow likely tied to investment or working-capital swings.

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 AG Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 39.38
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CH:UHRN, the sentiment is Positive. The current price of 39.38 is above the 20-day moving average (MA) of 38.55, above the 50-day MA of 36.14, and above the 200-day MA of 32.00, indicating a neutral trend. The MACD of 0.90 indicates Positive momentum. The RSI at 54.26 is Neutral, neither overbought nor oversold. The STOCH value of 49.80 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CH:UHRN.

The Swatch Group AG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CFR	78 Outperform	CHF92.27B	23.98	―	1.76%	5.10%	206.55%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
UHRN	58 Neutral	CHF10.07B	664.01	―	2.61%	-13.19%	-88.43%