01:56 AM EDT, 05/20/2026 (MT Newswires) -- Deutsche Bank Research lowered its sales estimates for H&M Hennes &Mauritz (HM-B.ST), as analysts anticipate more difficult trading conditions in the second quarter.

"The consumer confidence declines and unseasonal weather in Northern Europe are likely to lead to a tougher end to 2Q. Compounding this is a calendar issue for May, which will see an extra Sunday trading and an extra bank holiday in some markets, and may lower 2Q cFX by a further -1% cFX (which is recovered in 3Q). With the read-across from Primark and Action on trading in April, as well as weaker market data points for Germany, Spain and the UK, we take a slightly more cautious view on cFX sales growth,"the research firm said Tuesday. Deutsche Bank analysts now expect a 1% sales decline for the second quarter, against the previous projection of a 1% rise at constant currency and the consensus of a 1.5% growth.

Even with expected calendar upgrades, analysts also trimmed their third- and fourth-quarter assumptions by 1 percentage point to +2%. Consequently, full-year 2026 EPS estimates were downgraded by 6% to 7.78 kronor, while 2027 EPS forecasts were lowered 9% to 8.52 kronor, due to a 1 percentage point cut to the constant-currency sales forecast and a trim in gross margin expansion expectations.

"Looking into 2H26, the gross margin tailwind is fading and given freight and raw material headwinds, it may even revert back to a year on year decline unless it successfully passes through pricing to the consumer. Operating costs are starting to increase again from 2H as investment in technology steps up (DBe +1.7% in 2H from -0.5% in 1H). With limited confidence in cFX sales growth, we do not see this as an attractive setup,"the note said.

Against this backdrop, Deutsche Bank lowered the stock's price target to 160 kronor from 165 kronor, and reiterated its hold rating.