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    BofA says 'hold your horses' on luxury sector citing high multiples

    Picture of Prada SpA logoPrada SpA
    16/01/2026 12:10
    ** Bank of America tells investors to "hold your horses" on the luxury sector, citing high valuations after recent rally

** Says sector trades at 28x P/E, above historical average of 20x to 25x; needs EPS upgrades for further gains

** Upgrades UK-based watch retailer Watches of Switzerland Group WOSG.L to "buy" from "neutral", citing high exposure to fast-growing US market

** Downgrades Swiss luxury goods group Richemont CFR.S to "neutral" from "buy", arguing that its positive transformation story is now priced in and "limits share price upside from here"

** Cuts Italian fashion houses Brunello Cucinelli BCU.MI and Zegna ZGN.N to "neutral" from "buy"

** European luxury sector down as of 12:58 GMT, with LVMH LVMH.PA, Kering PRTP.PA, Richemont and Brunello Cucinel losing between 2.2% and 4.5%


    COMPANYNEW RATINGOLD RATINGPTOLD PT
    WOSGbuyneutralGBP 550GBP 480
    RichemontneutralbuyCHF 190CHF 190
    ZegnaneutralbuyUSD 11USD 12
    Brunello CucinellineutralbuyEUR 100EUR 115
    HermèsbuybuyEUR 2650EUR 2700
    LVMHbuybuyEUR 750EUR 675
    PradaneutralneutralHKD 49HKD 51
    MonclerneutralneutralEUR 55EUR 55
    KeringneutralneutralEUR 350EUR 350
    PandoraunderperformunderperformDKK 510DKK 510
    BurberryunderperformunderperformGBP 960GBP 920
    FerragamounderperformunderperformEUR 6EUR 5
    Swatch GroupunderperformunderperformCHF 150CHF 135
    Hugo BossunderperformunderperformEUR 34EUR 38
    

(Reporting by Laura Contemori, Dimitri Rhodes, Simon Ferdinand Eibach)

((Laura.contemori@thomsonreuters.com))

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