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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CONSUMER CYCLICALS
- S&P's followed earnings this week commenting the co is "in good position to sustain its credit metrics at their current levels throughout 2024" - as expected given we see it gross ~1.4x levered incl. leases on NTM (-5% yoy) EBITDA and saw no major issues in 1H earnings.
- S&P has (without naming) had a indirect dig at Kering; "Aspirational customers are now reducing their overall spending...having said that, LVMH has been able to retain a loyal base of high-end affluent customers thanks to its brand-elevation strategy. This explains its more resilient operating performance relative to that of some of its direct peers"
- As we flagged (even before Kering earnings) LVMH directly called out weaker aspirational customer impacting (at the edge) its Tiffany brand in particular.
We were a bit surprised with the moves heading into and out of earnings. This is a double A rated, largest luxury retailer in the word, running a 26% EBIT margin and now 14-straight quarters of organic growth.
It's trading wide of equal rated and slightly lower rated consumer curves including the 30s moving wide of lower rated Richemont. We see value on that line (at Z+49/B+83/3.2%) for high-grade investors.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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