Deshe in Paris - French fashion and stocks: physical fundamentals

Deshe in Paris - French fashion and stocks: physical fundamentals

Visiting Paris is a dream destination for many non-Parisians. It’s known for  Eiffel Tower, walking along the Seine River, seeing French paintings close up and the many famous French fashion houses (I’m most interested in the haute couture luxury brands). As a marketing manager for Deshe Analytics, I wonder less about whether I invest in classic Louis Vuitton shoes, an Hermès bag or a Birkin Bag (some models costs up to USD$400,000), as the classic Sex and the City scene said: "It's not a bag, it's Birkin". Now, I focus on which company’s stock is a better buy. 

As with all investments (fashion and financial) I search for quality. This generally starts with fundamental analysis. This shouldn’t be difficult, but there are so many options now, it’s nearly impossible for one person to know everything about everything. AI-based research makes this process much easier and faster because the software does most of the heavy lifting for us... 

For example, Louis Vuitton, is a luxury goods company, founded in 1987 by the merger of Moët Hennessy and Louis Vuitton, and  trades can be found in the stock markets under the tickername ‘LVMH’.

LVMH is a luxury goods company, founded in 1987 by the merger of Moët Hennessy, founded in 1869 and Louis Vuitton, founded in 1854. So the stock isn’t just about fashion, the LVMH brand also owns a portfolio of more than 70 brands including Louis Vuitton, Dom Pérignon, Dior, Bulgari and Sephora. So when you want to invest in Louis Vuitton stocks, you’re also investing in the future growth of all these other brands as well. 

Here a PS from the technical analysis:

From a fundamentals perspective, LVHM, which published it’s latest quarterly financial statement on July 26th, received a Neutral/Hold ranking from Deshe’s AI. Moreover, looking at the standard TA indicators, the stock doesn't look to be set up for a positive movement, receiving a Bearing ranking. 

 I might be better off with another luxury brand at this time.

Kering, a French luxury group that owns brands like Balenciaga, Gucci, Alexander McQueen and Yves Saint Laurent.

They similarly reported mediocre results that Deshe’AI forecasts to not make it a top-performing stock in the upcoming quarter. From a TA perspective as well, the stock received a British ranking on nearly all the key parameters.

So do  European luxury brands look better? Doing a quick Deshe search in the Textiles, Apparel & Luxury Goods industry we found that many of the best brand names received similar ratings:

Company Name & Ticker

Country

Rating

Report

Hugo Boss 

Germany

HOLD

here

Christian Dior 

France

HOLD

here

Hermès International 

France

HOLD

Here 

Prada

Italy

HOLD

here

Burberry Group 

United Kingdom

HOLD

here

Does this mean that investing in luxury stocks right now is a bit of a risk? Yes. Fears of recession, inflation, and continued supply chain issues seem to be weighing down on the sector, coupled with the actual performance of these individual stocks. For now, I will continue to keep an eye out for deals, even though I am not sure that the worst is yet behind us.

Anna in Paris - Hermes store

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