(News Bulletin 247) – HSBC on Monday raised its recommendation on LVMH stock, which it is raising from ‘hold’ to ‘buy’ with a price target raised from 750 to 999 euros.
If he expects a US market under pressure in the first quarter for the brands Louis Vuitton, Dior and cognac, the broker believes that these difficulties should only be ‘temporary’.
As for Dior, which generates 16% of operating profit, the broker says it anticipates a year of ‘consolidation’ following the quadrupling of the brand’s sales over the past four years.
Louis Vuitton, on the contrary, could sign an acceleration under the impetus of its new general manager, Pietro Beccar, whose first measures – such as the appointment of Pharrell Williams – prove that the mission of the luxury group is not to ‘ sell handbags’, but rather ‘culture’, continues HSBC.
Finally, concludes the broker, LVMH is less exposed to China than to the United States, which could prove to be a disadvantage in view of the reopening of the Chinese economy, he underlines, while estimating that the group should continue to benefit from the weakness of the euro, as in 2022.
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