The factors in favour of a rise in the LVMH share price:
The first undeniable asset of the LVMH group is of course its positioning on the international market.Even today, LVMH is still the world leader in the luxury sector and stands out in particular in certain very specific areas such as champagne, cognac and leather goods.In the fields of fashion, perfumes and cosmetics, it is also one of the largest international groups.Finally, it should also be noted that LVMH is ranked third in the world in the fields of jewellery and watches.
As far as the competition to which the group is exposed, it remains relatively weak in view of the very solid positioning of LVMH.Indeed it should be remembered that this company owns no fewer than 70 houses in the luxury sector with in particular the brands Louis Vuitton, which is the world number one in this field and which is showing significant growth and a remarkable level of profitability, but also Moët Hennessy for champagne, Dior, Céline, Givenchy, Guerlain, Kenzo, Bulgari, TagHeuer and Hublot.Thanks to these different houses, LVMH benefits from a very strong presence in the luxury market worldwide and is present in all segments.
We also appreciate the very good geographical distribution of the group's revenues, with a strong presence just about everywhere in the world.The group thus generates as much revenue in Asia, Europe and the United States, which gives it less exposure to economic risks and greater stability.
The distribution of LVMH between its different businesses also shows strong stability.This applies in particular to the fashion and leather goods activities and the wines and spirits activities, which represent the group's two core businesses, as well as to the watch distribution and jewellery sector.
As part of its overall strategy, the LVMH group exercises excellent control over its distribution channels.It is at the head of a global network consisting of the DFS banners for the Asian market, Miami Cruise, Sephora and Le Bon Marché in Europe.
LVMH is also a particularly profitable company, with a stable operating margin, which is maintained at around 20% regardless of the economic context in the luxury market.
Finally and in general, LVMH's financial situation has many assets to attract investors with a cash flow of more than 3.7 billion euros, a debt ratio of 16% and several record years in terms of operating profitability in general and sales achieved.