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Investing.com - Deutsche Bank (ETR:DBKGn) lowered its price target on Kering (EPA:PRTP) SA (EPA:KER) stock to EUR170.00 from EUR177.00 on Thursday, while maintaining a Hold rating on the luxury goods company. The company, currently trading with a market cap of $25.45 billion, has seen its shares decline nearly 40% over the past year.
The bank cited ongoing uncertainty at Kering, which is navigating a creative transition at its flagship Gucci brand with designer Demna and preparing for new Group CEO Luca de Mea to take the helm in mid-September.
Deutsche Bank noted that while Gucci appears to be avoiding the sequential slowdown from first quarter to second quarter that analysts forecast for most of the luxury sector, Kering’s other brands are suffering from reduced tourism spending by American and Chinese consumers.
The bank expects Kering to report a 15% group revenue decline in the first half of 2025, with cost-saving measures helping to limit operational deleverage, resulting in a group EBIT margin down 530 basis points to 12.2%.
Citing volatile external conditions, Deutsche Bank lowered its second-quarter and second-half currency-adjusted sales expectations for Kering, resulting in EBIT forecasts that are 8% lower for both fiscal years 2025 and 2026.
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