Interparfums Stock Delivers Strong Cash Yield – Upside Ahead?
Interparfums (IPAR) could be an interesting pick for your portfolio, with its high cash yield, good fundamentals, and discounted valuation
Interparfums navigates moderating 2025 sales guidance, now projecting $1.47 billion (+1% YoY) due to macroeconomic pressures and retailer destocking. Despite this, its Q3 2025 diluted EPS surged 6% to $2.05, extending 20 consecutive profitable quarters. New license growth from Lacoste and Coach drives strong sales, alongside a future 2027 Longchamp launch, capitalizing on the luxury fragrance market’s expected 8.86% CAGR to 2030.
Let’s talk numbers:
- Cash Yield: Not many stocks offer free cash flow yield of 5.0%, but Interparfums stock does
- Fundamentals: 3-Year average revenue growth of 14.7% and operating margin of 19.2% show reasonable fundamentals
- Valuation: IPAR stock currently trading at 41% below 2Y high, 12% below 1M high, and at a PS lower than 3Y average.
Free Cash Flow Yield refers to free cash flow per share / stock price. Why it matters? If a company produces high amount of cash per share, it can be used to fuel additional revenue growth, or simply paid through dividends or buybacks to shareholders. For quick background, Interparfums provides manufacturing, marketing, and distribution of fragrances and cosmetics internationally under various luxury and lifestyle brand names.
If you seek an upside with less volatility than a single stock, consider the High Quality Portfolio (HQ) – HQ has outperformed its benchmark – a combination of S&P 500, Russell, and S&P midcap index, and achieved returns exceeding 105% since its inception.
| IPAR | S&P Median | |
|---|---|---|
| Sector | Consumer Staples | – |
| Industry | Household Products | – |
| Free Cash Flow Yield | 5.0% | 4.2% |
| Revenue Growth LTM | 3.1% | 6.0% |
| Revenue Growth 3YAVG | 14.7% | 5.5% |
| Operating Margin LTM | 19.3% | 18.8% |
| Operating Margin 3YAVG | 19.2% | 18.2% |
| LTM Operating Margin Change | 1.7% | 0.2% |
| PE Ratio | 17.1 | 23.5 |
But do these numbers tell the full story? Read Buy or Sell IPAR Stock to see if Interparfums still has an edge that holds up under the hood.
That is one way to look at stocks. Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure
The Point? The Market Can Notice, And Reward
The below statistics are from high FCF yield selection strategy between 12/31/2016 and 6/30/2025. The stats are calculated based on selections made monthly, and assuming that a stock once picked, can not be re-picked for next 180 days.
- Average 6-month and 12-month forward returns of 10.4% and 20.4% respectively
- Win rate (percentage of picks returning positive) of about 74% for 12-month period
- Not over dependent on market crashes. During non-crash periods as well, this strategy has 12-month average return of nearly 18% with 70% win rate.
But Consider The Risk
That said, IPAR isn’t immune to big hits. It tumbled 81% during the Global Financial Crisis and dropped over 53% in the Dot-Com Bubble. The Covid sell-off knocked it down by about 53% as well. Even the smaller shocks like inflation in 2022 and the 2018 correction triggered declines roughly between 18% and 39%. So, no matter how solid it looks, IPAR can take some serious hits when markets turn sour.
But the risk is not limited to major market crashes. Stocks fall even when markets are good – think events like earnings, business updates, outlook changes. Read IPAR Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.