Added to YB: 2026-08-27
Pitch date: 2026-08-18
RCO.PA [neutral]
Rémy Cointreau SA
+1.03%
current return
Author Info
DB_Silver_Fox is a CFO and value investor interested in: European & US hidden champions, simple and effective business models, and US Banks. Sign up for the newsletter.
Company Info
Rémy Cointreau SA, together with its subsidiaries, engages in the production, sale, and distribution of liqueurs and spirits.
Market Cap
EUR 2.4B
Pitch Price
EUR 46.52
Price Target
N/A
Dividend
1.61%
EV/EBITDA
14.66
P/E
31.00
EV/Sales
3.34
Sector
Beverages
Category
turnaround
DB_Silver_Fox | Portfolio update as of 11.08.2026 - Rémy Cointreau SA
RCO.PA (hold): Special-situation hold on cyclical weakness from cognac overproduction (which added debt) plus China and US tariffs cutting sales; author (own calculations) sees the cycle as turned, expecting much less inventory investment after €700m+ inventory build and higher FCF, and notes the cognac inventory rises in value with time; flags capital allocation as the key risk — over FY2021–25 Rémy returned 120% of operating cash flow (€408m dividends plus €327m net buybacks vs €611m generated), funded by €174m new borrowing and a €186m cash draw, with buybacks in the years to March 2022 and 2023 at roughly €130–220 vs €37–47 today, while inventory absorbed €707m and kept building even as revenue fell 36% from its FY2023 peak; author wants cash rebuilt, debt reduced, and no repurchases until the cycle has visibly turned, viewing the selloff as overdone for a deep-moat business.
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