HSBC cuts LVMH, Burberry as luxury recovery proves slow
BUZZ-HSBC cuts LVMH, Burberry as luxury recovery proves slow ** HSBC downgrades LVMH LVMH.PA and Burberry BRBY.L to "hold" from "buy", as it expects H2 to be softer than H1 on average
** "The creativity reset we were hopeful about in soft luxury... has not had an immediate positive impact. It is building gradually, depending on the brands," it says
** HSBC cites a challenging macro backdrop and a slower-than-expected pick-up at Dior for LVMH, despite expressing confidence on the mid-to-long-term growth potential of the group
** For Burberry, the broker says the turnaround is tracking well, but visibility on H2 organic sales growth development is limited
** It also cuts target prices for Hermes HRMS.PA and Kering PRTP.PA to €1,650 and €490, respectively, on the lack of short-term catalysts and lower earnings estimates
COMPANY | RATING | OLD RATING | PT | OLD PT |
Burberry | Hold | Buy | 1,200 pence | 1,350 pence |
Hermes | Hold | Hold | €1,650 | €1,870 |
Kering | Buy | Buy | €305 | €340 |
LVMH | Hold | Buy | €490 | €600 |
Moncler | Buy | Buy | €60 | €67 |
Prada | Buy | Buy | HK$47 | HK$48 |
Richemont | Buy | Buy | CHF 225 | CHF 215 |
Swatch | Hold | Hold | CHF 175 | CHF 190 |
(Reporting by Gianluca Lo Nostro)
((gianluca.lonostro@thomsonreuters.com;))
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