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UBS downgrades LVMH to neutral, cuts target price

Published Nov 21, 2023 22:14
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LVMH shares experienced a notable decline on the CAC 40 today, following a downgrade by UBS from "buy" to "neutral". The luxury goods giant also saw its target price cut from €829.4 to €770 amid projections of a market share growth slowdown and an anticipated consolidation phase. This adjustment by UBS comes in response to the broader economic uncertainty that could impact LVMH's long-standing record of outperformance.

LVMH, known for its high-end products and dominance in the luxury market, was trading down by 1.1%, marking it as the most significant loser on the CAC 40 and the most actively traded stock of the session. UBS's analysis suggests that LVMH's current stock valuation is "fair," indicating that investors may have already accounted for the company's historical success in their pricing.

The downgrade and revised target price reflect a cautious stance from UBS regarding LVMH's prospects in a challenging economic environment. Despite LVMH's previous market share expansions, UBS now envisions a period where the company may not sustain its exceptional growth trajectory, leading to a more defensive position for its stock. Investors are responding to these new insights, adjusting their positions in light of the potential changes on the horizon for LVMH.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

UBS downgrades LVMH to neutral, cuts target price
 

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