Inditex (ITX) AI Stock Analysis

• Market Cap: €135.33B
• Dividend Yield: 2.99%
• Average Volume (3M): 2.00M
• Price to Earnings (P/E): 23.0
• Beta (1Y): 1.07
• Revenue Growth: 6.22%
• EPS Growth: 6.69%
• Country: ES
• Employees: 67,195
• Sector: Consumer Cyclical
• Sector Strength: 71
• Industry: Apparel - Retail
• EPS (TTM): 0.42
• Shares Outstanding: 3,116,652,000
• 10 Day Avg. Volume: 1,506,345
• 30 Day Avg. Volume: 1,995,606
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• 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: €49.71
• Price Target Upside: 14.33% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

• Rating: 73 Outperform
• Price Target: €46.00 ▲(5.80% Upside)

Inditex's strong financial performance is the primary driver of its overall score, showcasing robust revenue growth, high profitability, and a strong balance sheet. The valuation is moderately attractive with a decent P/E ratio and a good dividend yield, balancing growth and income. However, technical analysis indicates bearish momentum, with the stock trading below several key moving averages and indicators nearing oversold conditions, which slightly dampens the overall score.

Positive Factors

Financial Performance

Inditex reported PBT of €1,926mn, indicating strong financial performance.

Operational Efficiency

Opex leverage improved EBIT margins by 61bps yoy to 19.5%, reflecting operational efficiency.

Sales Growth

Net sales increased by 7.3%, showing a positive trend in sales growth.

Negative Factors

Inditex Business Overview & Revenue Model

Company Description

Industria de Diseño Textil, S.A. engages in the retail and online distribution of clothing, footwear, accessories, and household textile products through various retail concepts. The company sells its products under the Zara, Pull & Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, and Zara Home brands. It is also involved in the textile manufacturing, logistics, design, insurance, construction, and real estate businesses, as well as provides financial services. The company operates in Spain, rest of Europe, the Americas, and internationally. Industria de Diseño Textil, S.A. was founded in 1963 and is headquartered in A Coruña, Spain.

How the Company Makes Money

Inditex primarily generates revenue through the retail sale of its fashion products in store and online, with a significant portion of its earnings coming from its flagship brand, Zara. The company's revenue model is based on a combination of direct sales from its physical outlets and e-commerce platforms. Inditex operates a vertically integrated supply chain, which allows it to control production, distribution, and inventory management. This efficiency not only reduces costs but also enables the company to respond quickly to changing fashion trends. Key revenue streams include sales from its global network of stores and online sales, with a growing emphasis on digital retailing. Additionally, Inditex benefits from its extensive international presence, which allows it to tap into diverse markets and consumer bases. Strategic partnerships with logistics providers and technology firms also enhance its operational capabilities and customer engagement, further contributing to its overall profitability.

Inditex Financial Statement Overview

Summary

Inditex exhibits strong financial health with consistent revenue growth, high profitability margins, and a robust balance sheet. The company maintains minimal leverage, ensuring financial stability and flexibility. Cash flow generation remains strong, supporting its growth initiatives and shareholder returns.

Income Statement

Inditex has shown robust growth with a consistent increase in total revenue over the years, reaching €38.63 billion in 2025. The gross profit margin for 2025 stands at 57.85%, reflecting effective cost management. The net profit margin is healthy at 15.18%, indicating strong profitability. Both EBIT and EBITDA margins are impressive at 19.56% and 28.74% respectively, highlighting operational efficiency. The revenue growth rate from 2024 to 2025 is 7.48%, showcasing steady growth in a competitive retail environment.

Balance Sheet

Inditex maintains a very low debt-to-equity ratio of 0.0004, indicating minimal leverage and a strong equity position. The return on equity (ROE) is robust at 29.82%, suggesting effective use of shareholders' funds to generate profits. The equity ratio is healthy at 56.67%, highlighting a strong balance sheet and financial stability.

Cash Flow

The free cash flow for 2025 is €6.62 billion, with a slight decrease from the previous year, reflecting strategic capital expenditures. The operating cash flow to net income ratio is 1.58, indicating strong cash generation relative to profit. The free cash flow to net income ratio is 1.13, showing that the company effectively converts its profits into cash.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	38.63B	35.95B	32.57B	27.72B	20.40B
Gross Profit	22.34B	17.86B	18.56B	15.81B	11.39B
EBITDA	10.95B	9.97B	8.22B	7.10B	4.24B
Net Income	5.87B	5.38B	4.13B	3.24B	1.11B
Balance Sheet
Total Assets	34.71B	32.73B	29.98B	28.95B	26.42B
Cash, Cash Equivalents and Short-Term Investments	11.50B	11.42B	10.08B	9.39B	7.57B
Total Debt	5.91B	5.57B	5.60B	6.01B	6.35B
Total Liabilities	15.04B	14.06B	12.95B	13.19B	11.87B
Stockholders Equity	19.68B	18.64B	17.01B	15.73B	14.52B
Cash Flow
Free Cash Flow	7.08B	7.27B	5.26B	5.63B	2.31B
Operating Cash Flow	9.29B	8.67B	6.67B	6.75B	3.02B
Investing Cash Flow	-3.29B	-1.71B	-3.50B	-3.25B	2.51B
Financing Cash Flow	-6.61B	-5.47B	-4.61B	-3.91B	-2.79B

Inditex Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 43.48
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ES:ITX, the sentiment is Neutral. The current price of 43.48 is above the 20-day moving average (MA) of 42.45, below the 50-day MA of 43.57, and below the 200-day MA of 47.68, indicating a neutral trend. The MACD of -0.18 indicates Negative momentum. The RSI at 56.26 is Neutral, neither overbought nor oversold. The STOCH value of 90.34 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ES:ITX.

Inditex Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ITX	73 Outperform	€135.33B	23.04	33.03%	2.99%	6.22%	6.69%
Sector *	67 Neutral	¥279.70B	15.11	6.81%	2.50%	5.05%	-21.29%
0DGZ	―	€46.55M	50.00	5.09%	―	―	―

Inditex Corporate Events

Inditex Announces Strategic Management Reshuffle

Inditex has announced significant management changes, appointing Ignacio Fernández Fernández as General Corporate Director, overseeing Finance, Sustainability, Logistics, Transport, and Infrastructure. These changes reflect a strategic shift in leadership roles, with Andrés Sánchez Iglesias becoming Financial Director and Fernando de Bunes Ibarra taking over as Director of Sustainability. The company acknowledges the contributions of Javier Losada Montero, who is stepping down after 32 years, highlighting a continued focus on sustainability and operational efficiency.

The most recent analyst rating on (ES:ITX) stock is a Hold with a EUR47.00 price target. To see the full list of analyst forecasts on Inditex stock, see the ES:ITX Stock Forecast page.