(CercleFinance.com) – RBC announced on Friday that it had lowered its price target on Kering, from 480 to 440 euros, considering that a ‘more radical’ overhaul of the Gucci brand had now become necessary.
Given the extent of the drop in sales mentioned this week by the luxury group, the analyst judges that a significant relaunch of the brand is necessary, contrary to what the team has been able to ensure until now of management.
In its note, RBC said it was particularly concerned about the growing gap between the failure encountered by the label’s most emblematic lines and the much warmer reception reserved for the new collections designed by Sabato de Sarno.
And despite the support provided by Kering to Jean-François Palus, the current general director of Gucci, the financial intermediary emphasizes that the market does not share the same opinion.
‘Given the deterioration in financial performance, the appointment of a recognized executive with a favorable track record would, in our opinion, be welcome, in that it would encourage a more rapid recovery and the emergence of new ideas. from outside and the arrival of new challenges,’ he adds.
RBC – which maintains its ‘outperform’ opinion on the stock – believes that a recovery of the brand is still possible, but emphasizes that the latter is likely to take longer than expected.
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