Kering SA (KER) AI Stock Analysis

• Market Cap: €24.49B
• Dividend Yield: 8.01%
• Average Volume (3M): 451.00K
• Price to Earnings (P/E): 22.3
• Beta (1Y): 1.71
• Revenue Growth: -12.12%
• EPS Growth: -62.09%
• Country: FR
• Employees: 44,627
• Sector: Consumer Cyclical
• Sector Strength: 59
• Industry: Luxury Goods
• EPS (TTM): 2.08
• Shares Outstanding: 123,420,780
• 10 Day Avg. Volume: 343,637
• 30 Day Avg. Volume: 451,004
• PEG Ratio: 1.07
• Price to Book (P/B): 4.18
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 18.26
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €174.78
• Price Target Upside: -15.32% Downside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 19

• Rating: 73 Outperform
• Price Target: €226.00 ▲(9.50%Upside)

Kering SA's overall score reflects solid technical momentum and a strong dividend yield, slightly offset by challenges in financial performance due to declining revenue and profitability margins. The stock presents a reasonable valuation with potential for improvement in financial metrics.

Positive Factors

Creative Leadership

There is a constructive view on Demna's ability to drive relevance and excitement for Gucci, although his creative launch isn't slated until 4Q.

Product Strategy

Handbag changes could help drive traffic and sales densities of stores, with key product launches planned.

Valuation

Valuation looks supportive and may limit downside, especially on EV/sales, even though the stock is unlikely to outperform until positive revisions occur.

Negative Factors

Margin Pressure

There is pressure on margins due to operating deleverage, which is inevitable given declining sales and a largely fixed cost base.

Market Challenges

The company faces external headwinds such as weakening US demand and continued weakness in Chinese mall traffic.

Sales Decline

Kering had a weak start to 2025, with group comparable sales down 14% and its flagship Gucci brand continues to underperform with a 25% decline.

Kering SA Business Overview & Revenue Model

Company Description

Kering SA develops, designs, manufactures, markets, and sells apparel and accessories. The company offers shoes; leather goods, including handbags and wallets, purses, and other leather products; eyewear, textile accessories, etc.; and jewelry and watches, as well as ready-to-wear products for men and women. It also provides perfumes and cosmetics. The company provides Gucci, Saint Laurent, Bottega Veneta, Alexander McQueen, Balenciaga, Brioni, Boucheron, Pomellato, DoDo, Qeelin, Girard-Perregaux, Ulysse Nardin, and Kering Eyewear branded products. It sells its products through stores and e-commerce sites. As of December 31, 2021, it operated 1,565 stores. Kering SA sells its products in the Asia-Pacific, Western Europe, North America, Japan, and internationally. The company was formerly known as PPR SA and changed its name to Kering SA in June 2013. Kering SA was founded in 1963 and is based in Paris, France.

How the Company Makes Money

Kering SA generates revenue primarily through the sale of luxury goods across its portfolio of brands. The company's key revenue streams include direct retail, wholesale distribution, and online sales. Direct retail, through company-operated stores, accounts for a significant portion of Kering's income, as it allows for higher margins and direct consumer engagement. Wholesale distribution involves selling products to third-party retailers, which helps expand brand reach and accessibility. The company has also embraced digital channels, enhancing its e-commerce platforms to cater to the growing demand for online luxury shopping. Kering benefits from strategic brand positioning and marketing, leveraging the unique identity and heritage of its brands to appeal to affluent consumers globally. Additionally, the company may engage in selective licensing agreements and partnerships to broaden its market presence and product offerings.

Kering SA Financial Statement Overview

Summary

Kering SA's financial performance shows mixed results. The income statement indicates pressure on profitability with declining revenue and EBIT margins. However, a strong gross profit margin and solid cash flow generation are positives. The balance sheet demonstrates a stable financial structure with a moderate debt-to-equity ratio. Overall, financials highlight the need for revenue growth and improved operational efficiency.

Income Statement

Kering SA's income statement shows a decline in total revenue from 2023 to 2024, with revenue dropping from €19.566 billion to €17.194 billion. The gross profit margin remains strong at approximately 73.8% in 2024, and the net profit margin is about 6.6%. However, the decline in EBIT and EBITDA margins from 24.3% to 13.4% and 32.9% to 27.1%, respectively, suggests pressure on operational efficiency and profitability.

Balance Sheet

The balance sheet reflects a moderate financial structure with a debt-to-equity ratio of 1.35, indicating a relatively balanced use of debt and equity. The return on equity (ROE) stands at 7.6%, showing profitability on shareholder investments, albeit lower compared to previous years. The equity ratio is 34.4%, highlighting a stable capital structure but with room for improvement in terms of leveraging equity more effectively.

Cash Flow

Kering SA's cash flow analysis reveals a decrease in free cash flow from €1.848 billion in 2023 to €1.4 billion in 2024. The operating cash flow to net income ratio is strong at 4.15, indicating robust cash generation relative to net earnings. Despite a decline in free cash flow, the company's ability to maintain positive cash flow from operations is a positive indicator.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	17.19B	19.57B	20.35B	17.65B	13.10B
Gross Profit	12.68B	14.93B	15.20B	13.07B	9.51B
EBITDA	4.67B	6.43B	7.00B	6.15B	4.58B
Net Income	1.13B	2.98B	3.61B	3.18B	2.15B
Balance Sheet
Total Assets	43.35B	41.37B	33.94B	31.07B	28.01B
Cash, Cash Equivalents and Short-Term Investments	3.56B	3.92B	4.34B	5.25B	3.44B
Total Debt	20.14B	17.82B	11.19B	9.59B	9.26B
Total Liabilities	27.62B	25.36B	19.16B	17.33B	15.97B
Stockholders Equity	14.90B	15.21B	14.00B	13.35B	11.82B
Cash Flow
Free Cash Flow	1.40B	1.85B	3.21B	3.94B	2.10B
Operating Cash Flow	4.71B	4.46B	4.28B	4.88B	2.89B
Investing Cash Flow	-3.19B	-7.30B	-2.77B	-451.50M	-196.50M
Financing Cash Flow	-1.90B	2.38B	-2.14B	-2.93B	-1.62B

Kering SA Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 206.40
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FR:KER, the sentiment is Positive. The current price of 206.4 is above the 20-day moving average (MA) of 187.77, above the 50-day MA of 181.37, and below the 200-day MA of 212.68, indicating a neutral trend. The MACD of 6.32 indicates Negative momentum. The RSI at 66.25 is Neutral, neither overbought nor oversold. The STOCH value of 85.27 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FR:KER.

Kering SA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KER	73 Outperform	€24.49B	22.34	7.52%	8.01%	-12.12%	-62.09%
Sector *	67 Neutral	¥253.76B	13.29	6.48%	2.73%	5.14%	-11.70%
HESAF		$297.35B	60.18	28.67%	3.56%	―	―
0NPL		€82.92B	16.45	22.73%	3.26%	―	―
0OMK		€116.83B	48.66	6.00%	1.56%	―	―
0HAU		€243.70B	20.10	19.53%	2.68%	―	―
7EK		€93.80M	21.75	-7.61%	―	―	―