FRANKFURT/LONDON (Reuters) – Self-help measures, a tough stance on underperformers, and economic recovery could help German retailer Metro hang on to its share price premium over rivals, even without big asset sales.

Shares in the world’s No.4 retailer, which runs cash and carries, supermarkets, electricals and department stores, have risen about a third in value over the past two months amid growing optimism about its “Shape 2012″ restructuring plans and signs of a consumer recovery in Germany and eastern Europe.

The stock trades at 18.1 times forecast earnings, above bigger rivals Carrefour (CARR.PA: Quote, Profile, Research) and Tesco (TSCO.L: Quote, Profile, Research) on 16.5 and 12.8 respectively, according to Reuters data, leading some analysts to conclude that all the good news is priced in.

Indeed, Metro (MEOG.DE: Quote, Profile, Research) shares slipped back on November 2, despite the group beating third-quarter earnings forecasts and nudging up its profit expectations for this year.

However, the reasons for the third-quarter outperformance could lead to a more fundamental reassessment of Metro’s prospects which, if they lead to earnings upgrades beyond 2010, may make Metro’s shares look less expensive.

“The valuation is only stretched if you use the wrong earnings number,” said Deutsche Bank analyst James Collins.

Analysts are on average forecasting Metro will make earnings before interest, tax (EBIT) and one-off items of 2.9 billion euros (2.5 billion pounds) by 2012, implying an increase of about 600 million euros from the group’s new guidance for this year.

FRANKFURT/LONDON (Reuters) – Self-help measures, a tough stance on underperformers, and economic recovery could help German retailer Metro hang on to its share price premium over rivals, even without big asset sales.

Shares in the world’s No.4 retailer, which runs cash and carries, supermarkets, electricals and department stores, have risen about a third in value over the past two months amid growing optimism about its “Shape 2012″ restructuring plans and signs of a consumer recovery in Germany and eastern Europe.

The stock trades at 18.1 times forecast earnings, above bigger rivals Carrefour and Tesco on 16.5 and 12.8 respectively, according to Reuters data, leading some analysts to conclude that all the good news is priced in.

Indeed, Metro shares slipped back on November 2, despite the group beating third-quarter earnings forecasts and nudging up its profit expectations for this year.

However, the reasons for the third-quarter outperformance could lead to a more fundamental reassessment of Metro’s prospects which, if they lead to earnings upgrades beyond 2010, may make Metro’s shares look less expensive.

“The valuation is only stretched if you use the wrong earnings number,” said Deutsche Bank analyst James Collins.

Analysts are on average forecasting Metro will make earnings before interest, tax (EBIT) and one-off items of 2.9 billion euros (£2.54 billion) by 2012, implying an increase of about 600 million euros from the group’s new guidance for this year.

FRANKFURT (Reuters) – German sporting goods company Adidas (ADSGn.DE: Quote, Profile, Research, Stock Buzz) aims to grow sales to 17 billion euros ($24 billion) by 2015 as it strives to overtake market leader Nike (NKE.N: Quote, Profile, Research, Stock Buzz).

“Our aspirations are to outperform total market growth … to outgrow our major competitor and have the bottom line grow faster than the top line,” Chief Executive Herbert Hainer said on Monday in a presentation to analysts at the company’s headquarters in Herzogenaurach, Germany.

Last week, Adidas reported strong third-quarter results, lifted by U.S. and eastern European growth, and said it expected 2010 sales to grow by 8 percent at constant currency rates from 10.4 billion euros ($14.6 billion) in 2009.

Nike recorded sales of $19 billion in its year to May 2010.

Shares in Adidas were up 2.7 percent at 47.54 euros by 0918 GMT, the top gainers on Germany’s blue-chip index .GDAXI.

“The new strategy plan is very promising and is encouraging investors after strong results,” a trader at Frankfurt’s Alpha brokerage said.

Adidas, the world No. 2, said its key growth markets would be North America, Greater China, Russia/CIS, Latin America, Japan, Britain and India.

FRANKFURT, Nov 4 (Reuters) – Adidas (ADSGn.DE: Quote, Profile, Research, Stock Buzz), the world’s second biggest sporting goods maker, is predicting a further rise in profits next year as consumer confidence returns and it focuses on new products to drive sales.

After strong third-quarter results, lifted by good U.S. and eastern European sales, Adidas forecast on Thursday a rise of 10-15 percent in earnings per share in 2011, and a sales growth rate in the mid-single digits.

That was not enough for the market, however, which was looking for a more bullish forecast, and the shares were down 2.9 percent at 46.70 euros at 1335 GMT.

The company’s predicted rise in earnings implies an actual result of around 2.95 to 3.11 euros a share, below the current consensus market forecast of 3.19 euros according to Thomson Reuters I/B/E/S Estimates.

“Today’s announcements in our opinion opens no space for positive 2011 EPS revisions on the market,” DZ Bank analyst Herbert Sturm said in a note, adding that this year’s nine-month sales figure for China, a drop of 7 percent, was also disappointing.

Chief Executive Herbert Hainer said the 2011 outlook was “the best that we can give at the moment.”

But he shrugged off the persistently gloomy economic outlook for the United States, where Reebok sales soared 25 percent in the third quarter.

DUESSELDORF, Nov 2 (Reuters) – Germany’s Metro (MEOG.DE: Quote, Profile, Research, Stock Buzz), the world’s No. 4 retailer, raised its 2010 profit forecast after beating third-quarter expectations, driven by cost cuts and an economic recovery led by eastern Europe and Asia. Metro, which runs cash & carries, electronics retailers, supermarkets and department stores, said on Tuesday it expected 2010 earnings before interest, tax and special items of 2.3 billion euros ($3.2 billion), up from 2.2 billion previously.

“We are experiencing a significant pickup of business in all regions,” Chief Executive Eckhard Cordes said.

“Eastern Europe is making a comeback as a growth driver.”

International retailers are pinning their hopes on fast-recovering emerging markets to boost growth at a time when austerity measures are holding back many developed economies.

Germany, which accounts for just under 40 percent of Metro’s sales, has been enjoying one of the strongest economic recoveries in Europe, helping Metro shares to surge around 20 percent over the last three months.

RBS analyst Justin Scarborough welcomed the increase in profit guidance, but warned forecasts had been creeping up in recent weeks.

“(The) valuation is starting to look somewhat stretched and we would advise profit taking,” he said.

BERLIN, Oct 27 (Reuters) – Retailers are looking beyond the big emerging markets of Brazil, Russia, India and China (BRICs) as they hunt for growth amid signs that spending in U.S. and western European markets will remain subdued for some time.

Executives and economists at the World Retail Congress said strong economic growth and rising middle classes were drawing their attention to countries such as Colombia, Egypt, Indonesia, Mexico, South Africa, Turkey and Vietnam.

“These otherwise disparate countries have one thing in common: They are all on the radar screen of some of the world’s leading retailers,” consultants Deloitte and Planet Retail said in a report presented at the conference.

Some store groups have already identified their targets.

U.S. group Wal-Mart (WMT.N: Quote, Profile, Research, Stock Buzz), the world’s biggest retailer, said last month it was in talks to buy South Africa’s Massmart (MSMJ.J: Quote, Profile, Research, Stock Buzz) in a potential $4 billion that would give it a launchpad to expand through sub-Saharan Africa. [ID:nLDE68Q05T]

Ira Kalish, director of global research at Deloitte, said that with many U.S. and European retailers sitting on big cash piles and facing sluggish growth at home, the industry was primed for a pick up in dealmaking.

“I think within retail we are going to see a lot of transaction activity, a lot of cross-border transaction activity,” he told delegates.

BERLIN (Reuters) – Retailers in the United States and Europe must consolidate and invest in emerging markets and innovation or risk stagnating in an environment where domestic demand will remain subdued for years, industry leaders said.

Executives and economists at the World Retail Congress said the United States and most European countries were likely to avoid a slide back into recession, helped by a pick up in global trade that is being driven by demand from emerging markets like China.

However, they warned that for the foreseeable future, domestic demand would not return to the boom years of earlier this century, pointing out unemployment was set to remain high as governments seek to pay back the mountain of debt spent on easing the effects of the recession.

That will make for tough decisions in the U.S. and European retail industries, which have grown fat during the good times.

“The retail industry has grown too rapidly and has increased capacity far more than demand over the last decade and now we’re left with too many stores, too many retailers and certainly too many shopping centres,” Ira Kalish, director of global research at consultants Deloitte, said of the U.S. retail industry, adding he saw a similar picture in many European markets.

“We’re going to have a shaking-out, a consolidation that will come about through both merger and acquisition activity as well as through bankruptcy.”

With U.S. companies sitting on record cash piles and interest rates set to remain low, the ingredients are in place for a pick up in takeover deals, while store groups should also look to extend their presence in faster-growing emerging markets like India, Brazil and Russia as well as China, Kalish said.

FRANKFURT, Oct 18 (Reuters) – French group PPR (PRTP.PA: Quote, Profile, Research, Stock Buzz) made good on a promise to expand in the lifestyle and outdoor sector by charging the head of Puma (PUMG.DE: Quote, Profile, Research, Stock Buzz) with hunting for acquisitions and building a new unit based around the German brand.

The move is part of PPR’s long-held ambition to move away from retail, to focus solely on luxury and lifestyle and shed its conglomerate discount in terms of valuation.

The new sports and lifestyle division will generate higher turnover than PPR’s luxury unit Gucci Group, which also includes Balenciaga and Stella McCartney fashion brands, PPR chief executive Francois-Henri Pinault said.

“The sport and lifestyle division will be, in my view, more important in size, in turnover, because we are operating in mass-market segments, but not in terms of profit,” Pinault said in a joint conference call Puma CEO Jochen Zeitz.

PPR’s luxury brands had turnover of 3.4 billion euros ($4.75 billion) in 2009, compared with just under 2.5 billion for Puma.

Separately, PPR dashed hopes, however, that it would buy out the minority shareholders in Puma — the world’s No.3 sporting goods maker behind Nike (NKE.N: Quote, Profile, Research, Stock Buzz) and Adidas ADSGn.DE — sending the German company’s shares down 2.5 percent at 253 euros.

“There were some disappointed investors, as PPR said it did not intend to buy Puma wholly,” one trader said.

FRANKFURT, Oct 14 (Reuters) – German fashion group Hugo Boss (BOSG_p.DE: Quote, Profile, Research, Stock Buzz) raised its 2010 outlook after a faster than expected recovery in the luxury goods market, together with its strategy of opening more stores, helped it beat third-quarter forecasts.

After a sharp downturn, the luxury market has started to recover in 2010, driven by tourist shoppers from emerging markets such as China. In its third quarter, Hugo Boss saw EBITDA jump 42 percent to 150 million euros.

LVMH (LVMH.PA: Quote, Profile, Research, Stock Buzz), the world’s largest luxury goods group, also beat third-quarter forecasts on Thursday, driven by its stable of fashion, wines and champagne. [ID:nLDE69D03K]

Shares in Hugo Boss, known for its sharply cut suits, were up 4.8 percent at 46.18 euros at 1049 GMT, heading gainers on the German midcap index .

“Suits seem to fly off hangers,” a Frankfurt-based trader said.

Its shares have gained 79 percent this year as prospects for the luxury sector have improved.

A spokeswoman said Hugo Boss was satisfied with all of its markets and was aiming to open up to 60 of its own shops in 2010, which would take the total to 425.

LONDON, Oct 8 (Reuters) – Britain’s Thomas Cook (TCG.L: Quote, Profile, Research, Stock Buzz) is merging its high street travel and foreign exchange business with the Co-operative Group’s operation in a cost-cutting drive ahead of an expected period of weaker consumer spending.

The deal to create Britain’s largest retail travel network sent Thomas Cook shares up 4 percent in early trade to 186.9 pence.

“This is possibly the last consolidation opportunity in this sector,” Thomas Cook Chief Executive Manny Fontenla-Novoa told reporters on a conference call.

“This is a merger and no cash is changing hands, which makes it a very attractive deal for both parties.”

Thomas Cook, which announced a cost-cutting programme last week, said the deal will result in savings and benefits of over 35 million pounds ($55.8 million) per year, plus a further 10 million pound boost through increased product sales.

Fontenla-Novoa said the move should put Thomas Cook, which will hold a majority stake in the combined business, in a much stronger position should market conditions remain weak.

Consumer confidence is waning in Britain as the government hikes taxes and cuts public spending to rein in record debts. [ID:nLDE6720PZ]