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Burberry Group PLC (BURBY)
:BURBY
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Burberry Group
(OTC:BURBY)
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Rating:53Neutral
Price Target:
$16.00
▲(1.01% Upside)
Burberry's overall stock score reflects significant financial challenges and valuation concerns, with a negative P/E ratio and declining revenues. While the earnings call provided some optimism with strategic advancements and improved gross margins, the technical analysis indicates mixed signals, and the absence of a dividend yield further impacts the score. The company needs to address its operational and leverage issues to improve its financial health and investor appeal.
Positive Factors
Gross Margin Improvement
Improved gross margins indicate better cost management and pricing power, enhancing profitability and competitive positioning in the luxury market.
Cost Savings and Efficiency
The restructuring program's cost savings enhance operational efficiency, allowing Burberry to reinvest in growth initiatives and strengthen its financial health.
Increased Customer Growth
Growing Gen Z customer base signals long-term brand relevance and potential for sustained revenue growth as this demographic matures and increases spending.
Negative Factors
Overall Revenue Decline
Continued revenue decline highlights challenges in maintaining market share and demand, potentially impacting long-term financial stability and growth prospects.
High Leverage
High leverage increases financial risk, limiting flexibility and potentially impacting Burberry's ability to invest in growth or weather economic downturns.
Operating Loss
Operating losses reflect underlying profitability challenges, necessitating strategic adjustments to improve operational efficiency and financial performance.
Burberry Group (BURBY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.90B
Dividend YieldN/A
Average Volume (3M)3.49K
Price to Earnings (P/E)―
Beta (1Y)1.53
Revenue Growth-6.85%
EPS Growth-178.60%
CountryUS
Employees9,336
SectorConsumer Cyclical
Sector Strength84
IndustryLuxury Goods
Share Statistics
EPS (TTM)<0.01
Shares Outstanding360,985,380
10 Day Avg. Volume10,471
30 Day Avg. Volume3,490
Financial Highlights & Ratios
PEG Ratio0.29
Price to Book (P/B)3.03
Price to Sales (P/S)1.13
P/FCF Ratio9.97
Enterprise Value/Market Cap1.19
Enterprise Value/Revenue2.84
Enterprise Value/Gross Profit4.55
Enterprise Value/Ebitda50.31
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)0.27
Revenue Forecast (FY)$3.21B
Burberry Group Business Overview & Revenue Model
Company DescriptionBurberry Group plc is a British luxury fashion house established in 1856, renowned for its distinctive tartan pattern and signature trench coats. The company operates primarily in the luxury goods sector, offering a wide range of products including apparel, accessories, fragrances, and cosmetics. Burberry markets its products through a combination of retail stores, e-commerce platforms, and wholesale channels, catering to a global clientele that values high-quality craftsmanship and British heritage.
How the Company Makes MoneyBurberry generates revenue through multiple streams, with the primary sources being retail sales, wholesale distributions, and e-commerce. The retail segment includes direct sales from Burberry's own branded stores and online platforms, which account for a significant portion of its income. Wholesale revenues come from selling products to third-party retailers, expanding the brand's reach. Additionally, Burberry benefits from licensing agreements, particularly in fragrances and cosmetics, which provide a steady income stream. The company's focus on digital innovation and marketing, alongside strategic collaborations and partnerships, enhances brand visibility and customer engagement, further contributing to its earnings. Seasonal collections and limited-edition releases also drive demand and boost sales during peak shopping periods.
Burberry Group Earnings Call Summary
Earnings Call Date:Nov 13, 2025
(Q2-2026)
| % Change Since: |
Next Earnings Date:May 20, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted Burberry's strategic advancements and positive market reactions, particularly in returning to comp sales growth and gross margin improvement. However, challenges remain with overall revenue decline, particularly in wholesale and licensing segments, and ongoing traffic issues in stores. The sentiment is cautiously optimistic as the company sees positive indicators in customer growth and market confidence, but still faces significant hurdles.Q2-2026 Updates
Positive Updates
Return to Comp Sales Growth
In Q2, Burberry returned its retail business to comparable sales growth for the first time in 2 years, indicating a positive shift in consumer engagement and market performance.
Gross Margin Improvement
Burberry's gross margin improved by 410 basis points to 67.9% at constant exchange rates, driven by a healthier inventory position.
Cost Savings and Efficiency
The company is on track to deliver GBP 80 million in annualized savings by the end of the year, following an expanded restructuring program.
Increased Customer Growth
Burberry saw an 18% growth in Gen Z customers globally, with a 10% new customer growth in China, driven by the brand's authenticity and timeless British luxury appeal.
Positive Wholesale Market Reaction
Burberry received a significant increase in orders from key wholesale partners in the U.S. and Europe, reflecting confidence in the brand's product and direction.
Negative Updates
Overall Revenue Decline
Total revenue for the first half declined by 3% at constant exchange rates, or 5% on a reported basis, primarily due to declines in wholesale and licensing revenue.
Wholesale Revenue Decrease
Wholesale revenue decreased by 11%, slightly better than guidance, due to phasing and destocking of older fragrance lines, impacting overall performance.
Licensing Revenue Drop
Licensing revenue fell by 8% due to planned destocking of older fragrance lines, despite strength in fragrance and beauty businesses.
Challenges in Traffic and Sales
Traffic at Burberry stores remained challenging globally, though conversion rates improved, indicating ongoing struggles in attracting foot traffic.
Operating Loss Reported
Burberry reported an operating loss of GBP 18 million for the first half, attributed to restructuring costs and other financial charges.
Company Guidance
During the call, Burberry's CEO Joshua Schulman and CFO Kate Ferry provided detailed guidance and updates on the Burberry Forward strategy and financial performance. In the first half of fiscal year 2026, Burberry achieved a 2% growth in comparable retail sales in Q2, marking the first positive comp growth in two years. Total revenue was GBP 1.03 billion, with an adjusted operating profit of GBP 19 million. The company reported a free cash outflow of GBP 50 million, an improvement from the previous year. Gross margin improved by 410 basis points to 67.9%, driven by a healthier inventory position, with net inventory down 24% year-on-year. Burberry is on track to deliver GBP 80 million in annualized savings by the year's end, following an expanded restructuring program. The company expects no changes to its full-year guidance, with a continued focus on margin improvement, productivity, and cash flow. Retail space is anticipated to remain flat, with annualized savings of GBP 80 million and a GBP 50 million restructuring charge. Wholesale revenue is expected to decline mid-single digits for the full year, with a return to growth in the second half. Capital expenditure is projected at GBP 120 million, slightly below initial guidance. Currency headwinds of GBP 50 million on revenue and GBP 5 million on operating profit are anticipated based on October spot rates.Burberry Group Financial Statement Overview
Summary
Burberry Group faces significant financial challenges, with declining revenues and profitability issues. High leverage adds financial risk, though the company maintains some liquidity. Cash flow generation remains a relative strength, but declining cash from operations and free cash flow are concerns.Income Statement
The income statement shows a declining trend with revenue dropping from 2024 to 2025. The gross profit margin decreased, and a net loss was recorded in 2025, indicating profitability challenges. EBIT margin turned negative, further highlighting operational issues. A major concern is the significant decline in revenue and profitability compared to previous years.40
Negative
Balance Sheet
The balance sheet reveals a high debt-to-equity ratio, which indicates significant leverage and potential financial risk. The equity ratio decreased as stockholders' equity reduced. However, the company maintains a reasonable level of cash and short-term investments, providing some liquidity cushion. ROE turned negative in 2025, showing challenges in generating returns for shareholders.55
Neutral
Cash Flow
The cash flow statement shows a decline in operating cash flow compared to previous years. Free cash flow remains positive but dropped from 2024 to 2025, indicating less cash available after capital expenditures. The operating cash flow to net income ratio is notably high due to the net loss, suggesting operational cash inflow despite profitability challenges.65
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.46B | 2.46B | 2.97B | 3.09B | 2.83B | 2.34B |
| Gross Profit | 1.54B | 1.54B | 2.01B | 1.84B | 1.68B | 1.37B |
| EBITDA | 139.00M | 428.00M | 522.00M | 1.01B | 855.00M | 797.70M |
| Net Income | -75.00M | -75.00M | 270.00M | 490.00M | 396.00M | 376.00M |
Balance Sheet | ||||||
| Total Assets | 3.43B | 3.43B | 3.37B | 3.69B | 3.70B | 3.50B |
| Cash, Cash Equivalents and Short-Term Investments | 813.00M | 813.00M | 441.00M | 1.03B | 1.22B | 1.26B |
| Total Debt | 1.92B | 1.92B | 1.57B | 1.49B | 1.40B | 1.36B |
| Total Liabilities | 2.51B | 2.51B | 2.22B | 2.15B | 2.08B | 1.94B |
| Stockholders Equity | 914.00M | 914.00M | 1.15B | 1.53B | 1.61B | 1.56B |
Cash Flow | ||||||
| Free Cash Flow | 307.00M | 278.00M | 294.00M | 571.00M | 534.00M | 473.70M |
| Operating Cash Flow | 429.00M | 429.00M | 506.00M | 750.00M | 699.00M | 591.40M |
| Investing Cash Flow | -127.00M | -127.00M | -231.00M | -153.00M | -167.00M | -93.10M |
| Financing Cash Flow | 48.00M | 48.00M | -865.00M | -815.00M | -578.00M | -156.50M |
Burberry Group Technical Analysis
Positive
15.84
Price Trends
15.98
Positive
16.19
Positive
14.36
Positive
Market Momentum
-0.03
Negative
57.71
Neutral
96.18
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BURBY, the sentiment is Positive. The current price of 15.84 is above the 20-day moving average (MA) of 15.51, below the 50-day MA of 15.98, and above the 200-day MA of 14.36, indicating a bullish trend. The MACD of -0.03 indicates Negative momentum. The RSI at 57.71 is Neutral, neither overbought nor oversold. The STOCH value of 96.18 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BURBY.
Burberry Group Peers Comparison
UnderperformOutperform
Sector (61)
BURBY
Burberry Group
16.42
4.01
32.31%
TPR
Tapestry
116.30
55.02
89.78%
CPRI
Capri Holdings
27.04
4.74
21.26%
Burberry Group Corporate Events
Burberry Group PLC Reports Mixed Interim Results
Nov 14, 2025
Burberry Group PLC is a British luxury fashion house known for its iconic trench coats and distinctive tartan pattern, operating in the luxury goods sector with a focus on apparel, accessories, and licensing. In its latest earnings report for the 26 weeks ended September 27, 2025, Burberry reported a revenue of £1,032 million, marking a 5% decline at reported rates compared to the previous year. Despite a challenging macroeconomic environment, the company achieved a comparable store sales growth in the second quarter, signaling a positive response to its strategic initiatives under the ‘Burberry Forward’ program. Key financial highlights include a gross margin improvement to 67.9% and an adjusted operating profit of £19 million, although the company incurred a restructuring charge of £37 million, resulting in a reported operating loss of £18 million. The company also noted strong customer reception to its Autumn/Winter 2025 collections and continued progress in enhancing in-store experiences. Looking ahead, Burberry remains focused on reigniting brand desire and improving margins, with management expressing confidence in the company’s strategic direction and potential for sustainable growth.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.