Kering Shares Rise on Strong Q2 Performance and Analyst Upgrades
Kering shares surged by 16.9% in Paris after better-than-expected second-quarter results, particularly driven by improved performance at its flagship brand Gucci. The luxury group's turnaround strategy appears to be gaining traction, prompting several analysts to upgrade their ratings and raise price targets for the stock. Analysts highlighted Gucci’s early signs of recovery, including a return to growth in leather goods sales with new product launches such as the Borsetto and Paparazzo bags. HSBC upgraded Kering to 'buy' with an increased target price of 340 euros from 290 euros. Similarly, Bernstein raised its target to 270 euros from 220 euros due to Gucci’s revised pricing strategy aimed at correcting overpricing issues. Kering CEO Luca de Meo emphasized the brand's efforts in repositioning products and adjusting prices to better align with market demand. Analysts noted that these strategic shifts are helping attract back 'luxury orphans'—consumers who had dropped out of luxury spending due to economic factors.
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