Skip to main content
BoF Logo

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.

Burberry’s Biggest Bear Sees Luxury Stock Falling to 2010 Levels

The likelihood of a successful Burberry turnaround is limited in the near term, UBS Group AG analyst Zuzanna Pusz wrote in note.
Shares fell 6 percent after deteriorating sales in the Americas overshadowed a resurgence in Chinese demand.
The British group’s shares fell more than 7 percent on Wednesday after it warned of a challenging first half as soft demand in China and the US cause a drop in sales. (Burberry)

Burberry Group Plc’s biggest bear just became even more negative on the stock following Wednesday’s lacklustre results from the British luxury firm.

UBS Group AG analyst Zuzanna Pusz cut her price target to 750 pence from 971 pence, implying a decline of a third in the stock over the next 12 months, to what would be the lowest since 2010.

“The likelihood of a successful Burberry turnaround is limited in the near term,” Pusz wrote in a note on Thursday, reiterating her sell recommendation.

The analyst pointed to Burberry’s commentary on current trading, weak wholesale guidance for the first half of the current fiscal year, as well as a continued focus on cutting costs, rather than investment.

ADVERTISEMENT

The British group’s shares fell more than 7 percent on Wednesday after it warned of a challenging first half as soft demand in China and the US cause a drop in sales. A revamp of the business is yet to yield results, with the shares down about 20 percent year-to-date following a surprise profit warning.

Pusz turned bearish on Burberry in October after being neutral-rated on the stock for almost two years. Overall, Burberry has only two buy ratings, along with 17 holds and four sells, according to data compiled by Bloomberg.

By Kit Rees

Learn more:

Burberry Sales Fell 12 Percent in Early 2024

The brand isn’t the only one struggling in a cooling luxury market, but the weak numbers increase pressure on CEO Jonathan Akeroyd to deliver Burberry’s long-awaited turnaround.

In This Article
Topics
Organisations

© 2024 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions

More from Luxury
How rapid change is reshaping the tradition-soaked luxury sector in Europe and beyond.

How Chopard Seizes the Red Carpet Spotlight in Cannes

The Swiss brand out-sparkles rivals with a strategy aimed at driving sales as well as image. This year the company dressed Greta Gerwig, Demi Moore and Bella Hadid as well as hosting clients to view (and purchase) its high jewellery range.


view more

Subscribe to the BoF Daily Digest

The essential daily round-up of fashion news, analysis, and breaking news alerts.

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.
CONNECT WITH US ON
The Business of Beauty Global Forum
© 2024 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions, Privacy Policy, Cookie Policy and Accessibility Statement.
The Business of Beauty Global Forum