Luxury Groups: LVMH, Kering, Hermès, Richemont, Prada — 2026-09-24
The past week has been dominated by bearish analyst revisions into Q3 earnings season: RBC cut 2027 EPS estimates for Kering, Moncler, Hermès and Swatch and downgraded LVMH and Burberry, warning that luxury earnings forecasts are too rosy as demand and China recovery weaken. LVMH remains under pressure, hovering around €411 and out of Europe's top 10 by market cap for the first time since 2017, while Italian peers Moncler and Brunello Cucinelli stand out as relative bright spots in Milan. Fashion Weeks in Milan and Paris (running through September 28) are being leaned on as a catalyst by struggling brands targeting their wealthiest customers.
Luxury Groups: LVMH, Kering, Hermès, Richemont, Prada — 2026-09-24
Top developments
RBC cuts earnings estimates and downgrades LVMH, Burberry
Analysts at RBC said earlier this week (around September 22) that market expectations for European luxury-goods makers' earnings are overly optimistic given softening demand. RBC cut its 2027 EPS estimates for Kering, Moncler, Hermès and Swatch, downgraded LVMH and Burberry, and warned that the demand and China recovery picture is deteriorating. French outlet BFM Bourse reported Royal Bank of Canada no longer advises positioning in LVMH shares ahead of Q3 sales, which several analysts have lowered targets on. This matters because consensus numbers feeding into Q3 and H2 2026 guidance could face downward resets.
LVMH drops out of Europe's top 10 companies
LVMH has fallen out of Europe's top 10 companies by market capitalization for the first time since 2017, with its market cap at roughly €201 billion and shares down 37% in 2026. The stock traded around €405.50 on September 21, near its 52-week low of €400.05, and was little changed on September 23. The re-rating matters for index-heavyweight status and signals how far sentiment on the world's largest luxury group has fallen.
Milan and Paris runways court the ultra-wealthy as mass-luxury spending fades
With the sector recovery elusive, brands at Milan and Paris Fashion Weeks are staging lavish runway shows aimed at the wealthiest shoppers while middle-class customers cut back, amid inflation partly driven by the Middle East conflict. Milan Fashion Week runs through September 28. Reuters framed this as "the show must go on" for struggling luxury brands seeking a catwalk boost, with growth prospects worsening.
Italian houses shine: Cucinelli confirms 2026, Bernstein upgrades Moncler
While European luxury broadly weakened, Brunello Cucinelli confirmed its growth estimates for 2026 and Bernstein raised its rating on Moncler (chaired by Remo Ruffini), driving relative strength at Piazza Affari; analysts also flagged upside price targets for Moncler of up to +45%. Brunello Cucinelli told MilanoFinanza his company has reached "70% of the handwork" in its garments ahead of the SS27 collection. This divergence highlights worshipped craftsmanship-led brands outperforming mass-luxury houses.
KPMG sees sector adapting to regain growth
A KPMG report published Tuesday (September 22) argues luxury is adapting to renew growth despite geopolitical instability, offering a more constructive mid-term view than sell-side estimates.
Local view
French financial media bear the brunt of the pessimism: BFM Bourse warns that "with a deterioration in China, the rest of 2026 looks difficult for luxury," noting LVMH and Hermès have each lost about 37% on the stock market this year. MoneyVox asks whether CAC 40 luxury heavyweights — down more than 50% — are now a buying opportunity, polling analysts on outlooks. In Italy, Il Sole 24 ORE notes "luxury lifts its head" in Milan on Moncler and Cucinelli strength, and ANSA reported fashion stocks leading the FTSE Mib's early gains on September 17 (Moncler +2.2%, Cucinelli +1.16%).
Context & numbers
- LVMH: shares around €411 (September 22), down ~10% in a month and ~45% over three years, versus more than €900 at the 2023 peak; market cap ~€201 billion.
- International press: Seoul Economic Daily says LVMH shares have shed half their value in three years (-54% from the 2023 peak) as China's slowdown, Middle East conflict and repeated price hikes drive away middle-class shoppers.
- Sector backdrop: worldwide luxury spending reached €1,443 billion in 2025 and is on a trajectory of gradual stabilization in 2026, per the spring update of the Bain–Altagamma Luxury Goods Worldwide Market Study (June 2026).
- In China, brands including Louis Vuitton and Gucci have been closing stores in major cities as wealthy consumers reduce spending, per a widely-circulated report.
On the radar
- Milan Fashion Week runs through September 28, with Paris shows to follow — watch whether runway buzz converts into traffic and sell-through signals for troubled brands.
- Q3 2026 sales releases are approaching for the French groups; RBC and BFM Bourse flag rising pessimism around LVMH's third-quarter revenue print.
- Continued sell-side repricing risk: RBC's cuts to 2027 EPS for Kering, Hermès, Moncler and Swatch could be followed by other banks repricing the sector.
- The Altagamma Consensus 2026 (with input from 19 analysts) is the next scheduled Italian market-size reference point worth tracking.
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