From Morningstar: 2024-10-17 07:48:00

LVMH’s fair value estimate of EUR 650 remains unchanged as weakening revenue leads to reduced 2024 sales and profit forecasts. Shares are fairly valued after dropping 33% from 2023 peaks and falling 7% post Q3 results. Sales in fashion and leather goods division declined 5%, mainly due to weakened Chinese consumer demand.

Chinese consumer sales declined midsingle digit globally in Q3, outweighing slight improvements in European and American sales for LVMH. Louis Vuitton performed better, while Dior lagged. The company emphasized product innovation and marketing investments to drive performance, with flexibility in marketing spend compared to peers amid a tepid 3% organic sales decline.

LVMH attributes revenue decline to lower demand from Chinese consumers in jewelry and watch brands, continuing a trend from earlier in the year. Despite stable product mix and slightly higher prices, the company does not plan significant changes to attract aspirational consumers. With top-of-mind brands and strategic marketing investments, LVMH aims to enhance performance compared to luxury peers.



Read more at Morningstar: Luxury Slowdown? LVHM Shares Fairly Valued After Fall