2023-04-24 11:59:49
LVMH becomes the first company in Europe with a capitalization of over $500 billion
Earlier this month, Louis Vuitton Moët Hennessy released a quarterly report that beat analysts’ expectations.
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Louis Vuitton Moët Hennessy (LVMH) became the first public company in Europe to exceed $500 billion in market value. Capitalization rose to record highs thanks to rising demand for premium goods in China and the strengthening of the euro, writes Bloomberg.
Louis Vuitton Moët Hennessy is a French multi-industry corporation specializing in the production and sale of premium goods such as fashion, shoes, watches, jewelry, perfumes, cosmetics, alcoholic beverages, bags and more. The corporation owns many popular brands, including not only Louis Vuitton, Moёt and Hennessy, but also Christian Dior, Fendi, Givenchy, Kenzo, Marc Jacobs, Bulgari, Hublot and others.
Shares of LVMH as of 12:43 Moscow time rose on the Euronext Paris exchange by 0.3% to €903.7. As a result, the group’s capitalization grew to €454 billion or $500 billion. After that, the growth of quotations continued, according to the data at 14:30 Moscow time, the shares were trading at €904.1.
Demand for LVMH products persists even as rising inflation and rising interest rates might push the economy into recession, the agency said. Positive for the corporation and the strengthening of the euro. This month, the European currency once morest the US dollar jumped to a maximum in more than a year, as the dollar weakens amid expectations that a slowdown in the US economy will force the Fed to cut rates later this year.
Now, LVMH and other European luxury goods makers are to the European stock market what big tech was to the US—namely, market leaders that are growing even in the face of uncertainty and economic downturns. Bloomberg indicates that the ranking of the most valuable companies in the world is still dominated by representatives of the IT sector, however, thanks to a strong report for the first quarter of 2023, LVMH managed to take tenth place.
According to Lilia Peytavin, European market strategist at Goldman Sachs, premium manufacturers offer investors the best of the market, namely a focus on China with its growing demand, as well as high profitability of the business.
“This sets premium manufacturers apart from technology companies that have been declining for several quarters,” she added.
Shares of “American IKEA” collapsed by 52% following the news of bankruptcy
Earlier in April, LVMH released its first quarter results, which were positively received by the market. In particular, sales in the apparel and leather goods segment rose 18%, nearly double the analysts’ consensus estimate of 9%. The report turned out to be better than expected, including due to the lifting of anti-COVID restrictions in China and the restoration of international passenger air travel.
The ensuing rally in LVMH stock significantly increased the wealth of group head Bernard Arnault. From April 12 (on the eve of the publication of the quarterly report) to the present, the value of Arno’s assets has grown by $14 billion – up to $212 billion, follows from the data. index billionaires Bloomberg. The businessman is now considered the richest man in the world.
Marina Anufrieva.
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