Redcare Pharmacy Faces Mounting Competitive Pressure

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The period of relative calm for Redcare Pharmacy appears to be ending. A formidable new competitor is set to enter the online pharmacy market, directly challenging Redcare in a crucial segment. This development casts doubt on the resilience of the company's already fragile market sentiment, despite a minor uptick in its share price.

German drugstore chain dm has announced the launch of its own online pharmacy service, commencing Tuesday, December 16, 2025. Its initial focus will be on over-the-counter (OTC) medications, a category where established online players like Redcare have historically held a strong position.

This move represents a direct incursion into the core business of pure online providers. dm brings significant competitive advantages to the battle for market share, including a vast existing customer base, high foot traffic in its physical stores, and powerful brand recognition.

Investors are now weighing the potential short-term impact on Redcare's revenue and profit margins. The company's established logistics and distribution network, a recognized strength and a key asset in the online segment, will be tested against this new challenge.

Share Price Reflects Sustained Weakness

After some initial pre-market weakness, Redcare's shares stabilized, trading with a slight gain at €63.15. While this indicates a degree of daily recovery, the broader picture remains decidedly negative for the equity.

• Its 12-month performance shows a decline of approximately 57%.
• The current price sits roughly 57% below its 52-week high of €148.40.

Furthermore, the share price continues to trade significantly below its 200-day moving average of €94.00. This technical indicator underscores a persistent downtrend that began well before dm's announcement, reflecting existing skepticism about the company's business trajectory.

Structural Headwinds Intensify

Operationally, Redcare is navigating a difficult landscape. The company reported a negative earnings per share (EPS) of -€1.2117 for the past twelve months, highlighting an ongoing struggle to achieve sustainable profitability.

The entry of a major brick-and-mortar retailer like dm into the OTC space amplifies the pressure on several fronts:

• Pricing Competition: dm may employ aggressive pricing strategies to attract customers.
• Margin Compression: Lower prices in this core segment would further squeeze Redcare's already pressured margins.
• Customer Access: dm's extensive physical store network could effectively drive online orders through cross-selling initiatives.

Market observers view this as a clear structural challenge. To avoid losing further ground, Redcare will need to leverage its advantages in logistics, product range, and digital expertise more effectively.

The Real Test Begins

The launch of dm's service marks the start of a critical practical test for Redcare. The key question is whether significant market share in the OTC business will shift, or if Redcare can defend its position through superior service, assortment, and delivery quality.

Today's minor share price increase does little to alter the fact that the company is entering this new competitive phase from a position of distinct weakness. Trading activity around the €60 level in the coming weeks will reveal whether investors still retain any confidence in Redcare's ability to stabilize its business in the face of this formidable new rival.