(CercleFinance.com) – LVMH shares suffered the biggest drop in the CAC 40 on Friday after a lower recommendation from Morgan Stanley, which ended a difficult stock market week for the luxury giant.
Around 2:10 p.m., the stock lost 1.3% to fall below the 700 euro threshold, bringing its decline to almost 2% over the entire week.
In a note released in the morning, Morgan Stanley indicated that it had reduced its advice on LVMH from ‘overweight’ to ‘online weighting’, with a price target reduced from 860 to 790 euros.
According to the intermediary, the French group should continue to gain market share within a ‘structurally attractive’ sector, which does not prevent it from thinking that its share price will evolve without much direction over the next few years. coming months.
The analyst justifies his prediction by the general deterioration in demand observed at the end of 2023, which according to him should be accompanied by a complicated start to 2024 given the high basis of comparison for 2023.
Morgan Stanley also says it is concerned about the risk posed by the strong dependence of the group, and the sector as a whole, on Chinese consumers.
This deterioration comes after a series of unfavorable comments on the stock, Stifel having yesterday lowered its price target on the stock from 800 to 775 euros, while renewing its purchase recommendation.
In a note, the broker explains that it has once again revised downwards its earnings estimates for the French group in view of the recent deterioration of the luxury market.
Down more than 10% over the past three months, the stock has only posted a meager gain of around 2% since the start of the year.
‘It is probably not inappropriate to accumulate positions in LVMH in the current zone with a medium-term perspective,’ believes Alexandre Baradez, head of market analysis at IG France.
‘It seems to me that the precise signal of a return to an upward trend will only be above 737 euros,’ he warns.