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LVMH shares toast strong Q1 sales with record high

By Angela Gonzalez-Rodriguez

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Management |ANALYSIS

This is being a great week for the world´s largest luxury goods group. On Tuesday, shares in LVMH hit a record high following the announcement of a 15 percent year-on-year increase in first quarter sales.

After the company announced first-quarter organic revenue up by 13 percent, LVMH shares rose as much as 2.9 percent to an intraday record high of 213.50 euros. This was the steepest intraday advance in more than a month.

The stock also became the top performer on France's benchmark CAC-40 index, which was otherwise down 0.4 percent.

LVMH stock hits record high and casts a halo effect on other luxury shares

"What was truly impressive though is that all divisions were up double-digit, which was last seen in Q1, 2011," Deutsche Bank analysts said in a note. They currently recommend buying the stock. The German bank´s take on the French luxury goods giant echoed the general market sentiment: although LVMH warned that its business environment remained uncertain due to general political and macroeconomic concerns, analysts focused more on the strong sales.

LVMH´s good news had a hale effect on other luxury peers such as Kering, Hermés or Richemont, which saw their stock up by 1.1 percent, 0.9 percent, and 0.8 percent respectively.

Data collated by CNBC shows that LVMH shares are up around 17 percent so far in 2017. The results "also raise the bar for other stocks reporting in coming weeks" and including Prada and Kering.

"There is a better consumer environment for luxury, and LVMH is gaining share," said Mario Ortelli, an analyst at Sanford C Bernstein.

Foto: Louis Vuitton Web

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