LVMH: bodes well for 'Soft Luxury' (Credit Suisse)
(CercleFinance.com) - In trun, Credit Suisse hails LVMH's quarterly sales, which came in well above expectations.
Maintaining a buy rating ("outperformance") on the share, analysts' target price of 355 euros only suggests limited upside potential (about 8%).
With organic growth of 11% in the first quarter, the French luxury giant beat the (Bloomberg) consensus by two percentage points, Credit Suisse points out, along with even the most optimistic forecasts. This is indeed a positive sign for the sector,
That being the case, LVMH's "pleasant surprises" are concentrated in the Fashion & Leather Goods and Wines & Spirits sectors (broadly known as "soft luxury"), while Perfumes & Cosmetics and especially Watches & Jewelry slightly disappointed.
As a result, LVMH's results should rather bring specialists in leather goods and cognac (i.e. Salvatore Ferragamo or Rémy Cointreau) rather than those of "hard luxury", a luxury segment that includes jewelry and watches (such as Richemont and Swatch), Credit Suisse adds.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
Maintaining a buy rating ("outperformance") on the share, analysts' target price of 355 euros only suggests limited upside potential (about 8%).
With organic growth of 11% in the first quarter, the French luxury giant beat the (Bloomberg) consensus by two percentage points, Credit Suisse points out, along with even the most optimistic forecasts. This is indeed a positive sign for the sector,
That being the case, LVMH's "pleasant surprises" are concentrated in the Fashion & Leather Goods and Wines & Spirits sectors (broadly known as "soft luxury"), while Perfumes & Cosmetics and especially Watches & Jewelry slightly disappointed.
As a result, LVMH's results should rather bring specialists in leather goods and cognac (i.e. Salvatore Ferragamo or Rémy Cointreau) rather than those of "hard luxury", a luxury segment that includes jewelry and watches (such as Richemont and Swatch), Credit Suisse adds.
Copyright (c) 2019 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.