LVMH’s Strategic Initiatives and Brand Strengths Signal Long-Term Growth Potential Despite Short-Term Challenges

LVMH Moet Hennessy Louis Vuitton (0HAU – Research Report), the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Luca Solca from Bernstein maintained a Buy rating on the stock and has a €600.00 price target.

Luca Solca has given his Buy rating due to a combination of factors that, despite some challenges, indicate potential for LVMH’s future growth. The company faced a difficult start to FY25 with a decline in organic growth, particularly in the Fashion & Leather Goods and Wines & Spirits divisions. However, management has initiated strategic changes to address these issues, such as artistic collaborations and product innovations, which are expected to enhance brand creativity and appeal.
Furthermore, the turnaround in the Watches & Jewelry division is showing positive signs, with Tiffany leading the way. Solca believes that these efforts, along with the company’s strong portfolio of mega-brands, will eventually lead to a recovery in the Fashion & Leather Goods and Wines & Spirits divisions. Despite a reduction in EPS forecasts due to operating deleverage, Solca maintains a positive outlook on LVMH’s long-term prospects, valuing the company with a target price of €600.00 and an Outperform rating.

In another report released yesterday, Goldman Sachs also maintained a Buy rating on the stock with a €630.00 price target.