Headquartered in New York, Interparfums licenses and sells fragrances for luxury brands in over 120 countries. The company’s US operations cover labels such as Abercrombie & Fitch, Ferragamo, GUESS, Oscar de la Renta, Puma and Roberto Cavalli, while notable brands distributed by its European subsidiary include Coach, Jimmy Choo, Karl Lagerfeld, Kate Spade, Lacoste and Moncler, among others.
Interparfums is profitable, capital-light and net cash positive. The stock is up 60% on the NASDAQ exchange this year in an attempt to make up for the 8.7% and 35.5% declines in 2024 and 2025, respectively. There are two problems prospective investors have to consider, however. First, revenue growth has grinded to a halt this year. The company is guiding for sales of $1.49B in 2026, which is the exact same amount it achieved last year. Why is the stock trading at nearly 28 times earnings then, a multiple more appropriate for a high-growth startup?
The second problem involves Elliott Wave analysis and the textbook pattern we found on Interparfums’ 4-hour chart given below.
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It reveals that the rally from just above $77 to over $138 per share took the shape of a five-wave impulse. We’ve marked the pattern 1-2-3-4-5, where two lower degrees of the trend are visible within wave 3, while wave 4 seems to be a triangle, labeled a-b-c-d-e. According to the theory, a three-wave correction follows every impulse and usually erases the entire fifth wave. Given Interparfums’ high valuation, we think a pullback is due anyway.
Market reversals often require a catalyst though – something to remind the market of its job to value assets properly. Which brings us to the company’s 2027 guidance scheduled for November 18th. Analysts covering the company expect $1.6B in sales next year, implying a 6.7% revenue increase. This might turn out to be a big ask, however, given the 0% growth in 2026. Not to mention that even such a mid-single digit gain would hardly justify a P/E of 28.
So instead of extrapolating the recent past into the future, we think the market is likely to show its disappointment with Interparfums in the months ahead, maybe starting as soon as next week. If this count is correct, the support area near $105 per share looks like a natural bearish target in wave (2/B), before the bulls can return in (3/C).
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