H & M Hennes & Mauritz AB (publ) (HM-B.ST) stock analysis

In our weekly check, H & M Hennes & Mauritz AB (publ) is graded B (A to F). Of 25 checks on debt, profit, cash flow and trend: 17 pass, warnings: 4, red flags: 4.

About H & M Hennes & Mauritz AB (publ)

H & M Hennes & Mauritz AB (publ) is a Consumer Cyclical company (Apparel - Manufacturers) based in Sweden, listed on STO as HM-B.ST.

What our checks show for HM-B.ST

Red flags

• Net debt is 1.3x a year of EBITDA (debt/equity 2.01). That limits room in a downturn and raises refinancing risk.
• The gross margin fell by 12.4 points, to 40.4%: costs are rising faster than prices.
• Revenue fell 0.4% a year over the last 3 years.
• The stock has fallen as much as 73% from a peak. Would you have held through that?

Warning signs

• Analysts expect only about 2.9% a year of growth in revenue.
• The net margin is only 6%: little room if costs rise.
• The dividend takes 84% of profit: little cushion if profit falls.
• The stock is still below its previous peak.

Strengths

• Operating profit covers interest 8.2 times over.
• Operating cash flow is 2.65x net profit: the profit arrives as real cash.
• Earnings per share grew 56.3% a year over the last 3 years.
• Net profit grew 54.7% a year over the last 3 years.
• Free cash flow is 12.3% of revenue: cash for dividends, buybacks or growth.
• A large company: market value $24.67 billion.

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Questions

What grade does H & M Hennes & Mauritz AB (publ) (HM-B.ST) have?

In our weekly check, H & M Hennes & Mauritz AB (publ) is graded B (A to F). Of 25 checks on debt, profit, cash flow and trend: 17 pass, warnings: 4, red flags: 4. The grade is a risk check, not a buy or sell recommendation.

What are the main risks of HM-B.ST stock?

This week's biggest flags for H & M Hennes & Mauritz AB (publ): High debt, Gross margin falling, Weak revenue growth. In total 8 of 25 checks show a warning or a red flag.

What does H & M Hennes & Mauritz AB (publ) do?

H & M Hennes & Mauritz AB (publ) is a Consumer Cyclical company (Apparel - Manufacturers) based in Sweden, listed on STO as HM-B.ST.

The grade is a risk check, not a price forecast, and not investment advice. In our 10-year test (S&P 500, 2016-2026), stocks we graded A or B fell more than 30% 2-3 times less often than D or F, without a lower average return.

Updated 2026-10-24

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