FY26e net profit now seen flattish y-o-y at €323m, or +6% y-o-y ex- Romania (a distinct outlier), rising 6% to €343m next year…
…on stronger sales impetus & resilient margins; Low-risk inroads in Israel/Canada/Eurasia and Romania’s rebound to drive future growth
Buy with lower €35.5/sh TP (from €37.5): the market now discounts a hard-to-come-by L-T EBITDA margin dive to 15.3% vs 35.3% in FY25
Pardon the insolence, but things seem to be developing pretty nicely for retail heavyweight Jumbo (aside from distinct outlier Romania) in 2026e, thanks to solid demand across Greece, Cyprus and Bulgaria. In fact, we see all-important Greece (ex- franchise) L-F-L sales up 5% y-o-y in FY26e, registering for a second consecutive year some of its best organic growth periods (with no upward price adjustments). Once again, Jumbo’s model looks battle proven, as per our reckoning, uniquely resilient in weathering macroeconomic shifts, geopolitical headwinds and inflationary pressures.
FY26e net income seen up by just 1% y-o-y to €323m, standing 2% above the midpoint of guidance. Yet, as sales are seen up 5% y-o-y to €1.3bn, at first glance, the flat bottom- line raises inevitably eyebrows (if not the alarm) for investors as to the whereabouts of the gross margin, let alone Jumbo’s famous tight grip on costs. On a closer look, though, we come across to the twist. Cut to the chase, stripping away the local headwinds in Romania, our estimates point to an underlying core pre-tax income growth of 6% y-o-y to €313m,
courtesy of 5% higher sales and a rock-solid gross margin (flat y-o-y at €59%).
Romania offers long-term potential despite cyclical woes: In line with EC, we view Romania’s underperformance as a “cyclical adjustment” driven by aggressive fiscal consolidation, political gridlock, and depressed consumer spending. With real GDP seen
+2.3%/2.5% next year (as per EC/IMF projections) vs near-stagnation in 2026e, as lower inflation and unfrozen wages/pensions stabilise disposable income, Romania is poised for a distinct economic rebound, fuelled also by massive EU funding (leveraging some €77bn
through 2030). With nearly twice as large population compared to Greece, it goes without saying that Romania remains a key long-term growth market for Jumbo, facilitated also by space expansion, ie doubling store count over the coming years.
It’s a long way to Tipperary: Insider buying (since mid-July) seems to have triggered a decisive shift in investor sentiment and stock momentum. Since that initial move, Jumbo has logged gains of 15% in absolute terms, beating the Athens GI by 8%. While working
to bounce back from the deep year-to-mid-July losses of 20%, and a terrible 32% relative underperformance, Jumbo remains a notable laggard, -8% y-t-d, plunging 27% vs the local market. In fact, it will take an upward move of 37%+ (to €35.0/sh) for Jumbo to
fully bridge the 2026 year-to-date performance gap and breakeven with the Athens GI.
Buy with new lower TP of €35.5/sh (vs €37.5), with 9-12% near-term EPS cuts (export and Romania-led) more than offsetting stronger-than-expected FCF. Sitting on a pile of net cash (ie 16% of market cap), Jumbo looks compellingly priced, trading 10x its 2027e EPS and 6.2x EV/EBITDA. Also, FCF yields of 8%+ and 6.7% to 7.4% DY add to valuation appeal. What’s more, the market now discounts a L-T EBITDA margin plunge to 15.3% vs 35.3% in FY25. Even at our TP, Jumbo trades at a comfortable 13.9x EPS and 9.0x EV/EBITDA.
