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JPMorgan Growth Outlook Sends Pandora Higher: Copenhagen Mover

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Aug. 14 (Bloomberg) -- Pandora A/S reversed its steepest loss in a week in Copenhagen trading after JPMorgan Chase & Co. said investors should use declines to buy the Danish jewelry maker amid “outstanding growth.”

Pandora, which dropped 2.3 percent yesterday after reporting its second-quarter earnings, rose as much as 2.2 percent today. The company gained 0.8 percent to 214 kroner at 10:32 a.m. in the capital, with trading volume at 27 percent of the three-month daily average.

Investors should “use any stock weakness” to buy the shares, Chiara Battistini, a JPMorgan analyst, said in a note. The bank reiterated its overweight recommendation, after second-quarter results were “very robust,” she said.

Pandora exceeded estimates yesterday as new products such as a royal baby charm helped boost revenue in all its major markets.

Still, Prometheus Invest ApS, controlled by the Copenhagen-based private-equity fund Axcel and Pandora’s founding Enevoldsen family, will be allowed to part with some of its 41 percent holdings when a lockup expires next week. That’s depressed the Glostrup, Denmark-based company even after it reported “very strong financials,” Battistini said.

Net income rose to 431 million kroner ($77 million) from 63 million kroner a year earlier.

Dan Kirk Wejse, an analyst at Nordea Bank AB, also said investors should buy the stock after yesterday’s drop.

“We see the share price decline yesterday as a clear buying opportunity given continued good business momentum,” Wejse said in a note to investors. He raised his revenue estimates, saying the company’s forecast was “conservative.”

To contact the reporter on this story: Frances Schwartzkopff in Copenhagen at fschwartzko1@bloomberg.net

To contact the editors responsible for this story: Tasneem Brogger at tbrogger@bloomberg.net; Christian Wienberg at cwienberg@bloomberg.net

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