Zalando holds a probability of 22%.
After experiencing a tumble in worth, hitting a minimum of 16 euros in January 2024, the Zalando share has managed to maintain a position above the 20-euro threshold since the spring. The share surged in response to the company's announcements of enhanced profits and revenues in the second quarter.
Given the predictions of ongoing growth and profits in the online fashion industry following these positive financials, several analysts have maintained their bullish sentiments towards the Zalando share, with forecasted prices reaching up to 47 euros (Warburg Research).
The Investment Strategy
The favorable context may present an excellent opportunity for risk-taking investors to invest in the relatively undervalued Zalando share. Those wishing to mitigate the share investment's price risk could consider purchasing a cap bonus certificate associated with the Zalando share.
Besides dividends, direct purchase of the Zalando share will generate profits only if the share price increases. With bonus certificates, both with and without a cap, investors can secure double-digit annual gross returns not just from a rising share price, but also from a stabilizing or declining one.
Operation Details
If the Zalando share never plunges or dips below the 15.75-euro barrier by the certificate's maturity date, the cap bonus certificate will be redeemed at its maximum redemption value of 30 euros on September 26, 2025.
Important Info
The DZ Bank cap bonus certificate (ISIN: DE000DQ628G3) for Zalando shares has a bonus level of 30 euros and a cap, which sets the certificate's maximum payout. The barrier, active until September 19, 2025, is at 15.75 euros. You may purchase the certificate at 24.60 euros, given the current Zalando share price of 24.40 euros.
Prospects
Currently, the certificate is available for 24.60 euros, potentially offering a gross return of 21.95 percent (equivalent to 20 percent annually) by September 2025, assuming the share price does not succumb to a 35.45 percent drop and settle under 15.75 euros or below the valuation date.
Pitfalls
If the Zalando share reaches the 15.75-euro barrier by the valuation date and the share price remains lower than the cap at that point, the certificate will be cashed out at the closing Zalando share price for that day. If this value lands below 24.60 euros, the investment will result in a loss.
This article is not an endorsement to buy or sell Zalando shares or investment products tied to Zalando shares. No responsibility will be assumed for the accuracy of the data.
In light of the favorable market forecasts and the potential for continued growth in the online fashion industry, several financial analysts have been advising investors to consider investing in Zalando shares. With the cap bonus certificate associated with Zalando shares, investors can potentially secure double-digit annual returns, regardless of whether the share price increases, stays the same, or even declines.
