Luxury Sector Report

An Analysis of the Financial Performance of Firms in the Sector in the Q3-24 Period

Please See Disclaimer at the bottom - This Report is not Investment Advice.

Introduction

As readers might know now, one sector I love analysing is luxury fashion. Ever since, I started my investing journey a couple years ago, I have closely followed the sector while investing in it simultaneously. As Charlie Munger says, to be a investor, one must be a business analyst rather than a securities analyst. What this entails is the desire to never stop learning and unlearning things that may not be relevant or simply found to be untrue. In the past few months since my last luxury report, I have read the ‘Luxury Strategy’ by JN Kapferer and V Bastein while also boosting my understanding of companies in the sector, both public and private. Analysis from the book will be used to assess each company’s existing position. This report will consist of analysis of public companies I now consider to be true luxury, except for maybe Burberry, as it was covered in the report published a few weeks ago.

The quarter was an interesting one with many trends being observed that might affect the companies in the long term. Additionally, there were clear points of concern deriving from business factors instead of economic factors that led to the financial performance of firms. Aside from financial results, there were a few corporate movements that will shape the future of the Luxury giants. Management personnel will be even more key in shaping the company’s financial fortunes as they will not have the macro economy on their side in the coming periods. Lastly, I observed the outperformance of certain company segments that can help investors allocate capital to those companies with greater exposure to high performing sub sectors of luxury fashion.

Earnings