Richemont: What's not to like?

Research evidence excerpt

Richemont: What's not to like?

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in FY26e) engine of Richemont, to continue its outperformance vs the market and our coverage,

driven by category tailwinds and brand strength at Cartier and Van Cleef. As mentioned, we Price Performance Exchange-SWX

expect a FY28-30e CAGR of c.9%, 200 bps above the jewellery category. 52 Week range CHF 180.00-127.20

Key point #2: Cost discipline and pricing power: Despite inflationary pressures from raw

material prices and FX, Richemont has been able to deliver superior margins vs other Jewellery

players. Balancing material costs, a long-term approach to pricing and operating leverage is the

right strategy, in our view, which should allow margin benefits once cost of goods sold

normalise from current FX and gold-price related headwinds. We expect EBIT margins to reach

26.6% in 2030.

Source: IDC

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Key Point #3: Valuation does not account for superior fundamentals: At c.25x 12m forward

PE, Richemont is trading broadly in line with its 10-year average and in line with the rest of the

sector, while ignoring, in our view: 1/ superior execution vs. peers (price discipline) and 2/ its European Luxury Goods & Specialty

past (YNAP exited, succession issues resolved), 3/ it being the most straightforward way to get Retail

Viktoria Petrovaexposure to superior growth category, 4/ its extremely strong balance sheet and 5/ what we see

+49 (0)69 7161 1052

as realistic consensus expectations.

viktoria.petrova@barclays.com

BBI, Frankfurt

Filippo Croce

Barclays Capital Inc. and/or one of its affiliates does and seeks to do business with companies +44 (0)20 3555 2994

covered in its research reports. As a result, investors should be aware that the firm may have a filippo.croce1@barclays.com