Let's see if similar opportunity arises this time. Fingers crossed!!//@marketpre:Short-term dip likely, but dividend holds value – patience pays off. [OK]
LVMUY Slowdown, Time to Exit / Enter ?
@JC888：
Is this the beginning of the end of luxury ? $LVMH-Moet Hennessy Louis Vuitton(LVMUY)$ released its Q4 2025 earnings on Tue, 27 Jan 2026. It was not a fairy tale ending. Quarterly Financial overview. Revenue: came in at EUR$ 22.7 billion (US$ 27.1 billion); beating LSEG estimates of EUR$ 22.2 billion. It is a +1.0% YoY gain vs market consensus of a -0.3% decline. QoQ, the numbers remain status quo. Net Profit: was €10.9 billion, that’s a -13% YoY decline. Operating Margin: Remained solid at 22%, despite being squeezed by unfavorable currency exchange rates. Free Cash Flow: Grew by +8% to €11.3 billion, clearly showing strong cash generation. Dividend: Proposed a stable dividend of €13 per share. Earnings Perf. by Business Group Based on the luxury conglomerate business structure, below is how each Business Group fared: Watches & Jewelry: Grew by +8.0%. It was the standout performer, driven by strong demand for high jewelry at Tiffany & Co. and Bvlgari. Selective Retailing: Grew by +7.0%. Continued momentum from Sephora, that gained market share globally, while DFS reached a break-even point. (see above) Fashion & Leather Goods: Fell by -3.0% vs analysts’ expectations of -2.94%.; reflecting a cooling luxury market, even though Louis Vuitton and Dior maintained high profitability. Wines & Spirits: Fell by -9.0%, heavily impacted by trade tensions & tariffs affecting Hennessy Cognac sales in China and US. Perfumes & Cosmetics: Dipped marginally by -1.0% YoY, a ‘surprise’ dip during the peak year-end season despite steady innovation. Full Year 2025. Revenue: About €80 billion, roughly flat to slightly down organically vs 2024 but around double the level of a decade ago Organic growth: Around ‑1% for the full year 2025, with +1% organic growth in H2 2025, offsetting a weaker H1 2025. Operating profit: was EUR$ 17.8 billion, that’s a -9.3% YoY decline. It came in “better” than analysts’ forecast although margin was impacted by FX and softer demand. Net profit (group share): About €10.9 billion, down around -13% YoY versus 2024. Full-year profit from recurring operations was EUR $17.8 billion, The Assessment. What happened was sales at LVMH’s key fashion unit fell over the holiday season as the Louis Vuitton owner continued to suffer from sluggish demand. LVMH’s American Depositary Receipts slipped -1.0% in New York following the release. CEO Bernard Arnault said that the group faced a difficult operating environment and warned 2026 is unlikely to be straightforward, telling investors LVMH would limit spending this year as a result. On the whole, global luxury companies have been struggling to bounce back from a slump that followed a post-pandemic boom, with (a) cost-of-living pressures and (b) geopolitical uncertainty weighing on spending. Brands have also suffered from a consumer backlash after steep price increases. Like other sectors, some companies in this luxury sector have been more resilient, eg. Cartier owner $Compagnie Financiere Richemont AG(CFRUY)$ is a salient example that has bucked the trend. In uncertain times, consumers see gold necklaces, bracelets and the like as better stores of value than trendy handbags. Though LVMH has a smaller presence in “Watches and Jewellery”, that business performed better than expected in the latest quarter. It helped LVMUY to eke out a slight gain in overall sales despite weakness in fashion and leather goods. Bulgari performed particularly strongly during the 4th quarter. (see above) In a bid to further fortify its “Fashion & Leather goods” business group, LVMH paid EUR $1.0 billion (US$1.5 billion equivalent) to increase its stake in Loro Piana, (known for its cashmere sweaters), to 94% from 85 per cent in the second half of the year, an LVMH representative said. Objectively its (a) slowing growth in key markets and (b) cautious investor sentiment have dragged the stock, creating a gap between operational performance and share price movement. This luxury giant will continue to dominate global fashion, beauty and premium spirits, even as it struggles to keep pace with market expectations. The business is holding up — Cash flows are strong. Margins are healthy. The same cannot be said about the stock though. It’s down by -14.29% YTD (as of 30 Jan 2026). (see below) Disconnect between solid execution and fading investor confidence has become the central question for LVMH. It’s not about what’s wrong with the company. It’s about what Market is (now) asking of luxury: (1) faster growth, (2) new stories, or (3) just time to cool off ? Below is a look at that gap of “why the numbers say strength, while the stock says wait” ? Stabilizing Growth. Strong Margins. Shifting Narrative. On paper, 2025 wasn’t a bad year. LVMH’s total revenue fell -1.0% organically; that is essentially flat. Yes, it is not exciting but far from a breakdown. What’s the issue? The problem isn’t what LVMH is doing. It’s how the market is reading the next phase. Investors are no longer treating luxury as a guaranteed growth story. High base effects from a post-COVID boom, a slow China recovery, normalization in US, and forex pressure from a strong euro have all reset expectations. The question is not whether LVMH is still executing, rather “where will the next leg of growth come from” ? Brands with pricing power are finding that annual increases do not land as easily. Tourist flows have returned, but not uniformly. In key categories like fashion, watches, and spirits, the step-change narrative (the kind that justifies premium multiples), is missing. Luxury is still profitable. But it’s no longer in hypergrowth. And that’s the turn the market is digesting. Luxury’s 3 Big levers. In 2025, there were 3 macro levers that drove most of the deceleration across the luxury sector, LVMH included. How are they faring, a month into 2026? 1. Is China Back ? Much of the optimism heading into 2025 hinged on a full Chinese rebound, only that it did not materialize. Travel resumed, but local consumption lagged. The hoped-for “revenge spending” phase gave way to a more cautious, regionally uneven recovery. At LVMH, this showed up in the numbers: Asia (excluding Japan) was down -11% in Q1, barely scrapping into positive territory by Q4 2025. Watches & Jewelry, that includes strong brands like Bulgari and Tiffany, held up thanks to Chinese demand for hard luxury. Fashion & Beauty, recovery was slower than expected, especially in the middle of the market. Luxury shoppers in China have in essence, morphed into 2 profiles: The ultra-rich are still buying without reservations. The broader aspirational class are becoming more cautious and purchasing less. This hurts companies that leaned too much into China or have pushed prices way too high. 2. Foreign Exchange the culprit. For years, luxury’s global footprint benefited from currency swings. In 2025, that reversed - the Euro strengthened against US dollar, Yen, and Renminbi. That hit reported revenue and profits even when sales volumes held steady. LVMH estimated that changes in the value of global money (exchange rates) hurt the numbers. This alone lowered revenue growth by -3% and cut over EUR$ 1.0 billion off profit. Profit margin fell by -1.1%, due entirely to currency shifts, not because the company was run poorly. Even though the core business is doing well, it looks bad to investors because "official" revenue and profit numbers are still going down. 3. US Consumer Has Landed After 2 years of stimulus-driven spending, US luxury consumer, especially the aspirational class, have returned to normal spending habits People are still spending but they choose to spend on high-end travel and fancy dinners instead of buying new clothes or bags. Shoppers are more careful about price tags. They are no longer buying luxury items as impulsively as they did in 2021 & 2022. Good news is this did not cause a collapse at LVMH and US remained one of LV’s most stable regions. But steady US sales were not enough to make up for weaker sales in other parts of the world. Technical Analysis. For week ending 30 Jan 2026, LVMUY has fallen by -7.48% closing off Friday at $129.28 /share. Will it continue to consolidate this week ? As of 30 Jan 2026 Simple Moving Average (SMA). In the short term LVMUY is expected to remain volatile as stock price is still below its 20-day SMA ($143.74) and 50-day SMA ($145.31). Its long-term prospect remains intact as stock price is still above its 200-day SMA ($124.81). MACD. Its MACD is exhibiting the same consistent short-term volatility: The MACD (12, 26) is at -3.77, remaining in negative territory below the signal line ( -2.10). The negative divergence (-1.67) indicates that downward momentum is still active. RSI. TSLA’s 14-day RSI is currently at 30.68, on the verge of “oversold”. It suggests that the stock has been sold aggressively recently and may be due for a bounce or a period of stability. My viewpoints: (mine only) For a group as broad as LVMH with 75 prestigious brands under its belt, it didn’t miss in 2025. It simply did not outperform in a way that moves markets anymore. But: Growth is stabilizing. Margins are still strong. Business remains diversified, well-run, and structurally advantaged. After 3 years of surging demand, the story has shifted from acceleration to digestion and US market, impatient by nature has moved ahead with the numbers. Investors are not selling because they doubt the LVMH’s brands. They are selling because the step-change is not obvious: Fashion is slowing from a high base. Spirits are absorbing a downcycle, exacerbated by Trump’s tariffs. China’s is recovering, but slowly. Last but not least, pricing power once a guaranteed lever, now carries more friction. This is what a re-rating looks like. Not a collapse, just a quiet repricing of expectations - a shift from “how fast can it grow?” to “how long can it compound?” With a stable & attractive dividend of EUR $13 /share, I will wait patiently for the right entry price. Remember to check out my other posts. (See below). Help to Repost ok, Thanks. Must Read: Click on below titles to access. Repost to share, Like as encouragement ok. Thanks. TSLA investors Short Change by Musk, AGAIN ! Buy NVDA, GOOG, MSFT if US Shutdown again? Bernstein says AT&T, Best Telco 2026 ! Sure ? Do you think LVMUY will continue to correct in the coming weeks ’? Do you think LVMUY is a worthy investment to add to one’s holdings ? If you find this post interesting, give it wings! ️ Repost and share the insights ? Do consider “Follow me” and get firsthand read of my daily new post. Thank you. @Daily_Discussion @TigerPM @TigerStars @Tiger_SG @TigerEvents
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