Hugo Boss AG fell to a 2 1/2-week low in Frankfurt trading after Hamburger Sparkasse cut its recommendation on Germany’s biggest luxury clothier to “hold” from “buy,” citing the cost of the retail chain’s expansion.
Hugo Boss preferred stock fell as much as 3.1 percent to 52.91 euros, the lowest intraday price since Dec. 21, and was down 2.3 percent as of 11:38 a.m. The decline was the third biggest on Germany’s MDAX Index of medium-sized companies.
“After the stock gained 130 percent last year, I don’t see much upward potential for the time being,” Christian Hamann, an analyst at the bank, said today in a telephone interview from Hamburg. The rising number of Hugo Boss’s own-brand stores is increasing overhead costs for the Metzingen-based company, Hamann wrote in a report to investors yesterday.
The company added 78 Hugo Boss-brand stores in the first nine months of 2010, and the number of outlets totaled 510 as of Sept. 30.
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