Salvatore Ferragamo SpA (SFRGF) stock slid further Thursday after the luxury goods maker issued a cautious outlook for the year ahead and said that the focus in the boardroom remains on rationalizing the retail business.
The maker of high-end suits and $920 slip-ons said that management will remain focused on rationalizing the retail operations, reducing excessive inventories and launching new products in order to boost growth, adding that 2017 will be "a year of transition".
Ferragamo stock slipped nearly 3% during early trading in Milan, to change hands at an intraday low of €26.11 before paring losses.
Thursday's price action came after the stock fell more than 5% on Wednesday, with investors reacting to bearish comments made by management at a shareholder meeting in Paris.
Ferragamo reported sales that met expectations for the fourth quarter, back in February, and a modest beat against estimates for net income which has helped to propel the stock higher during recent months.
The luxury goods maker saw revenues pressured during 2016, with growth difficult to achieve, particularly in light of lower tourist flows in Europe and a slowdown in Chinese consumer spending. This is while competition has also intensified among luxury firms.
Out of the 19 analysts recorded by Factset as covering the stock, 14 of them have it rated as a hold while just two have it as a sell.