(Tiper Stock Exchange) – LVM extensionthe largest luxury group in the world, has now become the eleventh largest company in the world and the first European company to cross the $500 billion mark. In fact, during the session on the Paris Stock Exchange, the stock reached 904.6 euros per share, equal to a capitalization of more than 454 billion euros, i.e. 500 billion dollars.
The shares of the conglomerate led by Bernard Arnault have gained more than 30% since the beginning of 2023, thanks to the strong performances recorded in the year ended 31 December 2022 and in the first three months of the year. In particular, 2022 closed with a record turnover of 79.2 billion euros, up 23%, and a net profit of 14.1 billion euros, up 17%. The first quarter of 2023 recorded record revenues of €21 billion, up 17%.
Sales in the first quarter were supported by a strong recovery of activity in China, which is serving as a growth engine at a time when shoppers in the US are starting to slow down their post-pandemic shopping spree. LVMH owns, among others, iconic brands such as Louis Vuitton, Tiffany, Givenchy, Kenzo, Bulgari and Moet Hennessy.
“There geographical diversification is in favor of the luxury stock, benefiting from the Chinese reopening as well as from the greater Japanese demand, so much so that the European and American markets together represent only slightly less than half of the total turnover (about 49.3%)”, points out Gabriel Debach, market analyst by eToro.
“Chinese reopening reporting higher outlook from management, with double-digit first-quarter momentum of auspicious for the performance in the year“, adds the analyst.
Analysts see room for further enhancements of the stock, with 30 of the 36 analysts following the stock – according to Bloomberg – having a Buy recommendation. In particular, Bank of America sees the stock reach €1,000 in the next year. “LVMH is too cheap given the attractiveness of the luxury goods sector, its strong portfolio of brands and best-in-class execution,” it wrote in an April 13 report.