From Morningstar: 2024-08-28 08:26:00

FTSE Russell will make a decision on Burberry’s inclusion in the blue-chip index after its next quarterly review. Shares in the luxury fashion designer have dropped 50% in 2024 and 70% in the past year. Morningstar metrics for Burberry show a fair value estimate of £13.30 and a narrow economic moat rating.

Analyst Jelena Sokolova points out hurdles like Burberry’s exposure to slower-growth products, failed ventures in fashion-forwardness and leather goods, and recent price hikes amid a luxury buying slowdown. Sokolova sees potential upside in Burberry’s shares, with a fair value estimate of £13.30. Morningstar has reduced its fair value estimate for Burberry from £15.70 due to weaker expectations and slow sales recovery.

Burberry’s sales revenue decreased by 21% in the three months to June 29, with sales dropping significantly in the Asia Pacific region, mainland China, and the Americas. The company has suspended its dividend due to disappointing results. Statistics indicate a challenging period for Burberry, impacted by various market factors.



Read more at Morningstar: Burberry is About to be Kicked Out The FTSE 100….