Kering Shares Take a Breather After Nearly 5% Weekly Rebound
Midday sees a pause for Gucci's parent company's stock amidst a declining CAC 40. The pullback follows a rebound that had pushed the stock above its short-term moving averages. A recent broker note failed to bolster the stock price.
Consolidation After Rebound, Despite Raised Target by CIC Market Solutions
Kering shares drop 1.49% to €250.60, down from €254.40 the previous day. The stock is among the lowest performers in the CAC 40, which is down by 0.42%, while the luxury sector gives back some of its recent gains. The session fails to extend the momentum seen on Tuesday, when the stock had moved above its short-term averages. Nonetheless, the weekly increase remains at 4.95% and the monthly gain at 8.16%, indicating that the rebound initiated at the end of May is not undermined by this pause. In terms of recommendations, CIC Market Solutions yesterday raised their price target to €340, reiterating their buy advice. At the current price, the target offers a theoretical potential of over 35%. According to the consensus of surveyed analysts, the stock is trading at about 37.7 times the earnings expected for the current fiscal year and 25.3 times those of the following year, a valuation that reflects the expectation of a gradual improvement in margins.
Stock Caught Between Surpassed Short-Term Averages and a Distant MM200
The stock price now sits above the MM20 at €244.88 (a +2.34% difference) and the MM50 at €248.45 (+0.87%), confirming the short-term recovery. However, the MM200 at €273.50 remains 8.37% above the current price, highlighting the significant journey still required to erase the quarterly decline of 7.32%. The RSI at 57 indicates a neutral to slightly bullish momentum, without signs of exhaustion. The immediate resistance to watch is €255.55, tested the previous day. The sector context continues to weigh heavily on the stock. Jewelry and gold sales in China dropped by 21.3% year-on-year in April according to the NBS, while Swiss watch exports to the Chinese market grew by 17.1%, showing a highly polarized demand. Over one year, the stock still shows a gain of 46.79%. The next significant operational milestone will be the publication of the half-year results, traditionally expected at the end of July.
