Logitech Earnings: Investors Mark Down Shares on Cautious Fiscal 2025 Outlook

No-moat Logitech reported strong fiscal third-quarter numbers, with sales broadly in line but gross/operating profits and margins handily beating the FactSet consensus. Furthermore, fiscal 2024 guidance was raised above consensus expectations for non-GAAP operating income. Despite the surprisingly positive results, shares were down around 10% intraday. We surmise the markdown was due to Logitech’s cautious comments on fiscal 2025. While not providing specific numbers, commentary implied minimal growth with high macroeconomic uncertainty in fiscal 2025, while consensus was looking for a solid 5% increase going into the quarter. In contrast to the market, we’re raising our fair value estimate 9% to $60 (CHF 52.50) as our near-term estimates have proven to be too conservative. At current levels, we still think the shares are overvalued.