LVMH

LVMH reported Q1 26 sales slightly below expectations (+1% organically vs. consensus of 1.5% and our estimate of 2%), with the Middle East conflict weighing by around 1% on organic growth.

Wines & Spirits and especially Watches & Jewelry outperformed, while Fashion & Leather Goods remained the key disappointment.

Encouragingly, local demand improved in both the US and China, and Asia delivered its best top-line performance (+7% organically) since 2023.

Still, management’s message remained cautious and confirmed that margin stabilization requires 3 to 4% top line growth.

We are encouraged by the improving qualitative tone in the two key markets, but it remains too early to turn over optimistic.

Expert Opinion:
Stock is back to more attractive valuation levels with PE26 at 20x and 18.9x for 2027. Yet we expect the economic environment may keep being lackluster for the next few months, at least until we have visibility on the impact of rising oil prices on global demand. Discretionary consumption is likely to be negatively impacted over the near term. Still too early to jump back into the LVMH ship. 

For daily updates, subscribe to our newsletter and for detailed information, reach out to us at sales@alphavalue.eu