World’s largest jeweler under pressure as analysts warn it will be hit by volatile silver price

Pandora, the world's largest jeweler, is nether unit aft analysts warned that the volatile terms of metallic was a "pernicious problem" for the company.

The banal fell much than 9% connected Tuesday aft the informing from Jefferies analysts, who downgraded it from Buy to Hold. It recovered astir 1.5% successful Wednesday greeting trading but remains down 28% year-to-date, extending 2025 losses of 46%. The institution volition study 2025 results connected Thursday.

The analysts wrote that Pandora was "caught betwixt a stone and a hard place" acknowledgment to the outgo of metallic and a "more pressured consumer."

Spot silver was trading 5.5% higher aboriginal Wednesday astatine $89.50 an ounce. It recovered from a historical sell-off past week: Friday was its worst time since 1980, aft a agelong rally.

"The astir pernicious occupation volition beryllium a long-lasting hesitancy to prosecute successful the name, fixed metallic terms moves. This means that adjacent if metallic retrenches and the banal lifts connected mechanical net momentum, capitalist engagement volition beryllium dilatory successful returning," Jefferies said.

Pandora shares person fallen sharply implicit the past year, portion metallic has rallied.

In January, Pandora cut its net guidance and warned astir weakening user sentiment successful the U.S. 

The existent culprit, however, is the terms of silver, Jefferies said.

"With metallic present jumping around, we are reluctant to endorse an progressive proposal taxable to a peculiar concern and volatile input," the expert said. "The challenges of the past fewer months volition mean, adjacent successful a much mean metallic terms world, PNDORA volition stay substantially cheaper than adjacent a twelvemonth ago."

While determination was a important silver sell-off successful caller days, prices stay astir 3 times higher than they were a twelvemonth ago, implying 60% little profits for Pandora successful 2027, according to Jefferies' model.

The analysts chopped their terms people connected shares to 530 Danish kroner ($84) from 850 kroner.

"We uncertainty a power to silver-plating oregon stainless alloy volition enactment arsenic a panacea fixed the added complexity of manufacturing and the imaginable deterioration of lawsuit connection these imply," they added.

On Friday, metallic had its worst time since 1980 aft President Donald Trump announced Kevin Warsh was his nominee to beryllium the adjacent Chair of the Federal Reserve, easing fears astir the cardinal bank's independency that had been fueling a thrust into safe-haven assets similar metals.

While rising input costs are squeezing Pandora's margins from 1 side, a deteriorating macroeconomic backdrop is hitting it from the other. The company's halfway demographic, lower-income consumers, is struggling to header with rising costs successful what's been dubbed the "K-shaped economy."

To combat rising input costs, Pandora raised prices by astir 14%, which damaged user engagement, Jefferies said.

Citi and Deutsche Bank analysts besides downgraded Pandora shares successful January to Hold oregon Hold-equivalent, citing slowing income momentum and utmost metallic inflation.

"Near-term visibility has diminished considerably, worsened by a volatile macro situation successful the US and Europe (~80% of sales) and imaginable marque and jewellery depletion fatigue," Citi said. 

The Deutsche analysts said that Pandora was improbable to beryllium capable to trim metallic usage capable to offset the metal's rising cost. "If metallic holds astatine $90... the signifier of Pandora's operating economics and maturation algorithm request to displacement substantially," they said.

While they accidental traders person somewhat captured the downside, expert estimates whitethorn beryllium downgraded erstwhile Pandora gives much colour connected trading and mitigating enactment successful its full-year results connected Thursday.