LVMH raised by UBS to buy - believes in return to profit growth
Investment bank UBS has raised its recommendation on French luxury giant LVMH to buy from neutral. The target price is raised to 680 euros, from 513 euros.
“Over the past two years, we have remained in the background when it comes to LVMH, waiting for signs of a return to positive EPS development, which we now believe has occurred,” UBS writes in an analysis.
The share rises today by around 1.4 percent to 606 euros.
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Incoming reports:
EssorLuxotica: Revenue +6.7%
Kering: Revenue -10% y-o-y. At the same time, the cosmetics division is being sold to L’Oreal for 4 billion
Hermes: Revenue +4.8% y-o-y
Prada is still to come later today. Considering that Kering is still battling its internal demons, these are quite good results from the luxury companies!
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Free news about LVMH in Kauppalehti:
The share price of luxury goods house LVMH was up one percent in the morning. Bloomberg reported, citing its sources, that LVMH’s well-known brands Louis Vuitton, Dior, Tiffany, and Loro Piana are planning to open multi-story stores in China’s capital, Beijing, in December after years of preparation.
China’s important luxury market has been subdued recently, but the bottom is now believed to be at hand. For companies in the sector, the recovery of the Chinese market to clear growth would be a major driver.
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Luxury giants report that signs of life are once again visible in China after a long period of silence.
Prada, Coach, and others see demand stabilizing, even though consumer caution and a weak economy generally slow overall growth. Growth is still uneven, but according to the story, the signs are positive.
Brands are investing heavily in China, as well as in Chinese preferences and their social media activities. Luxury giants believe that China will continue to be an important long-term growth driver.
"Key Points
- Executives from Prada, Coach, EssilorLuxottica and Value Retail report stabilizing demand in China after months of volatility.
- UBS data shows early signs of improvement, though spending by Chinese tourists overseas remains subdued.
- Analysts caution the recovery is uneven amid weak consumer confidence, property strain and rising local competition."
https://www.cnbc.com/2025/11/16/forget-the-china-gloom-luxury-bosses-say-shoppers-are-back.html
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LVMH has bought a minority stake in the watch manufacturing subcontractor, La Joux-Perret. So, as I understand it, this is about gaining a deeper foothold in the manufacturing chain, not buying a new brand. According to the news, La Joux-Perret has had deep cooperation with Tag Heuer, at least.
The deal sum is not disclosed, but it smells like a small deal to me.
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Pietro Beccari continues as CEO of Louis Vuitton and also takes over the leadership of LVMH’s fashion division.
Sidney Toledano will then step down from his operational role; he has been the CEO of LVMH Fashion Group. Apparently, he will remain as Chairman of LVMH Fashion (?).
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Prada announced it had acquired competitor Versace for 1.25 billion euros, thus uniting these brands under one roof.
Prada thus confirmed having received the necessary permits and finalized the deal. Versace’s future “phase” will be led by Lorenzo Bertelli, who does not expect rapid changes but nevertheless sees significant untapped growth potential in the Versace brand.
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