Richemont: Credit Suisse upgrades sell rating

(CercleFinance.com) - Credit Suisse has abandoned its negative stance towards the share of the Swiss luxury group Richemont.


Previously a seller ("underperform" rating) of the share, analysts have now upgraded their rating to "neutral". Even so, they have trimmed their target price from 89 Swiss francs to 86 Swiss francs.

After three years of underperforming the luxury goods sector and disappointing 2017/2018 results, Credit Suisse now thinks that the Richemont share has limited downside potential. This is particularly so as the group's profile of high-end “hard luxury” remains attractive - particularly regarding its exquisite jewelry.

The outlook for watches is improving, the broker's report says. “Group wholesale revenue has been largely impacted by inventory buybacks and a sell-in adjustment. We believe inventories in the trade are now much healthier than three years ago and Richemont's brands are now some of the least discounted on the grey market,” the broker's report says.


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