Kering: reassuring on Gucci, UBS upgrades to buy
(CercleFinance.com) - This morning UBS upgraded its neutral rating on the Kering share, now recommending investors buy it.
Alongside this upgrade, the broker has raised its 12-month target price from 515 euros to 550 euros.
Trading at a 2020 P/E of 16x, which is pretty low for a luxury goods group share, UBS analysts say that Kering's "risk-reward profile looks appealing". Admittedly, after three years of stellar performance by its flagship branch Gucci, investors fear a hard landing, while the brand's momentum is decelerating.
UBS does not believe this at all; UBS Evidence Lab WeChat data points to "trends for Gucci stabilising", which represents the lion's share of about 80% of group profits. Analysts say that this should drive a re-rating of the Kering share.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
Alongside this upgrade, the broker has raised its 12-month target price from 515 euros to 550 euros.
Trading at a 2020 P/E of 16x, which is pretty low for a luxury goods group share, UBS analysts say that Kering's "risk-reward profile looks appealing". Admittedly, after three years of stellar performance by its flagship branch Gucci, investors fear a hard landing, while the brand's momentum is decelerating.
UBS does not believe this at all; UBS Evidence Lab WeChat data points to "trends for Gucci stabilising", which represents the lion's share of about 80% of group profits. Analysts say that this should drive a re-rating of the Kering share.
Copyright (c) 2019 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.