The world’s largest fashion retailer staged a stock-market comeback this week as Inditex SA’s push to differentiate itself from fierce ultra-low-price competition shows signs of bearing fruit.
The owner of Zara, Bershka and Massimo Dutti has seen its shares jump 14 percent, putting them on track for their best week in five years. Strong third-quarter results, coupled with accelerating November sales, were seen as evidence of the company’s resilience against weaker consumer sentiment.
Inditex Overtakes the European Retail Sector
This week’s surge put the stock on course for an annual gain, after what had previously looked like a lackluster 2025. Inditex — whose second-largest market is the US — had been punished for its exposure to tariffs and a weaker greenback, amid concerns about softening consumer demand and intensifying competition from Chinese fast-fashion firms.
While its 10 percent rise this year trails the 50 percent jump for UK retailer Next Plc and the 19 percent gain at Sweden’s Hennes & Mauritz AB, Inditex is now outperforming the broader European retail sector.
Analysts have welcomed the firm’s push to steer its Zara and Massimo Dutti brands further into the premium segment as it seeks to outmuscle competitors such as Shein and Temu. “The strategy is not to chase ultra-low prices, but to deliver premium-looking products at a good-value price point,” Alphavalue analyst Jie Zhang wrote in a note.
After this week’s rally, Inditex is trading at a substantially higher valuation than peers at 26 times forward earnings — on par with luxury behemoth LVMH.
The firm’s strong third-quarter earnings reinforce “the quality of the business and will make investors question whether the right peer group for this company is Luxury rather than Retail in our view,” said Deutsche Bank AG analyst Adam Cochrane.
Analysts Have Turned More Bullish on Inditex This Year
Inditex’s latest trading update spurred upward earnings revisions and price target upgrades, with more bullishness among brokers likely to follow, as the current consensus 12-month forward price target doesn’t leave any room for further upside.
“These growth levels should provide reassurance of the continued opportunity for outperformance, including into 2026,” said JPMorgan & Chase Co. analyst Georgina Johanan.
By Levin Stamm
Inditex’s Sales Rise, Showing Retailer’s Resilience
The Zara owner’s sales accelerated in November, highlighting its resilience in the face of weakening consumer sentiment that’s hitting many of its peers.
