Redcare Pharmacy Shares Struggle as Profitability Concerns Overshadow Revenue Growth

Redcare Pharmacy NL0012044747

The equity of Redcare Pharmacy is currently caught in a stark divergence between its business performance and its market valuation. The online pharmacy giant has reported robust sales growth for the 2025 fiscal year, yet its stock price continues to trend downward. Investors are penalizing the company, signaling that in the current market environment, expansion without accompanying profitability is no longer sufficient.

From a fundamental perspective, the company presents a divided story. Preliminary figures for 2025 confirm sustained demand, with revenue climbing to €2.9 billion, up from €2.4 billion the previous year. In the fourth quarter alone, Redcare generated sales of €794 million. This demonstrates that the company's business model is effectively driving top-line growth.

However, the market's focus has decisively shifted to the bottom line. For the full year 2025, a loss per share is still anticipated. This indicates that the company's expansion continues to be funded by losses. Consequently, investor hope now rests almost entirely on 2026, with forecasts for that year projecting a shift into positive earnings for the first time.

Technical Weakness and Market Pressure

From a chart perspective, the stock is under significant pressure. It ranks among the weakest performers in Germany's MDAX index. The longer-term view is sobering: the share price has declined nearly 48% over the past twelve months. Short-term momentum is also negative, with the stock posting substantial losses over the last three months.

Closing at €63.00, the shares are trading perilously close to their 52-week low of €60.35. This level is now viewed as a critical technical support zone. Market observers warn that a breach of this floor could trigger further selling from technically-driven traders. The broader market sentiment adds to the burden, with concerns over US tariffs and general investor caution toward unprofitable growth companies weighing on the MDAX.

Analyst Consensus: High Targets Amid Skepticism

A notable discrepancy exists between the prevailing market mood and the assessments of financial analysts. Despite the severe price decline, many experts maintain that the stock's intrinsic value is considerably higher. The average price target stands at approximately €159, implying substantial theoretical upside potential.

Recent analyst updates from January 2026, however, paint a mixed picture:
* Deutsche Bank Research remains extremely bullish, reiterating a "Buy" rating with a €200 price target.
* Jefferies also confirms its "Buy" recommendation, setting a target of €150.
* Barclays adopted a more cautious stance, reducing its target from €130 to €110, but maintained its "Overweight" rating.
* UBS expressed clear skepticism, with a €74 target that suggests very limited room for appreciation.

The upcoming detailed financial reports will be crucial for the stock's future trajectory. To defend the key €60 support level, Redcare Pharmacy must demonstrate that its multi-billion euro revenue can finally be converted into sustainable profits in the current year.