JPM sees luxury trends staying muted in Q4

Prada SpA

11/11/2024 10:06

** J.P.Morgan expects trends to remain muted for European
luxury names in Q4 due to continued China softness and despite
possibly better consumer confidence in the U.S. after elections
    ** Q3 performance was worse than feared and JPM says it
expects broadly similar trends in Q4 vs Q3
    ** "No one was immune, including the most defensive and
highest quality players," it says on soft trends with Chinese
consumers, but adds that elsewhere the trends were more mixed
depending on the company
    ** It sees flat organic sales growth for the sector in Q4
    ** "Besides top-lines, profitability should also be a
growing focus for investors going into FY updates, and the risk
to margins in the context of sales flat at best" - JPM
    ** It sees Prada  1913.HK  as an outlier, pointing to
accelerating momentum at Miu Miu, resilience at the Prada brand
and margin expansion
    ** Among sectors, it stays structurally more positive on
jewellery vs soft luxury, and confirms its relative preference
for Richemont  CFR.S  vs the rest of the sector

 (Reporting by Anna Pruchnicka)
 ((anna.pruchnicka@tr.com))