In this article, we discuss the top 10 luxury stocks according to analysts along with the latest updates around the industry.
The luxury retail industry is facing significant challenges, with major brands like Burberry, Hugo Boss, and Gucci experiencing substantial drops in their profits. The decline in luxury sales, especially in Asia and the Americas, has been a major concern, with Burberry and Hugo Boss seeing notable decreases in their revenue. Other brands such as Richemont and Swatch have also reported significant downturns in sales, particularly in China. The overall luxury market index has seen a sharp decline, which indicates widespread struggles in the sector.
Luxury brands have traditionally relied heavily on Chinese consumers, who have contributed significantly to their growth. However, the slowing Chinese economy and a cautious consumer base have led to reduced spending on luxury goods. The economic slowdown in China is attributed to factors such as lower land sales, an aging population, and decreased exports.
Despite the challenges, some brands made significant strides such as the Italian high fashion women’s clothing and accessory brand, Miu Miu, which saw a nearly 60% growth last year and a 90% growth in the first quarter of this year. This helped its parent company, Prada Group, increase its sales as well.
The luxury market has historically bounced back from downturns, and many in the industry hope that the current challenges are temporary. However, the recent performance has reminded the sector that luxury items are not immune to economic challenges, and consumer demand can fluctuate based on economic conditions and consumer confidence. Nevertheless, luxury brands are comparatively less affected by the economic conditions as most of their purchases are made by a very small group of elite consumers. You can also read our article on Top 11 Luxury Clothing Stocks to Invest in Now, where we discussed luxury consumer behavior in detail.
Top 10 Luxury Stocks According to Analysts
Our Methodology
For this article, we made a list of nearly 20 luxury stocks with at least Moderate Buy ratings according to analysts and narrowed our list to 10 stocks with the highest average analyst price target, as of August 5. We also added the hedge fund sentiment around each stock which was taken from Insider Monkey’s database of over 900 elite hedge funds as of Q1 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Top 10 Luxury Stocks According to Analysts
10. Harley-Davidson, Inc. (NYSE:HOG)
Average Price Target Upside as of August 5: 19.13%
Number of Hedge Fund Holders: 29
One of the top luxury stocks on our list, Harley-Davidson, Inc. (NYSE:HOG) is a Wisconsin-based manufacturer and seller of motorcycles. The company operates through Harley-Davidson Motor Company, LiveWire, and Harley-Davidson Financial Services segments. It holds a major stake in LiveWire Motorcycles (LVWR), a company focused on electric motorcycles. The Harley-Davidson Motor Company provides a variety of motorcycles, including cruisers and sport bikes, and also supplies motorcycle parts, accessories, and clothing. Additionally, Harley-Davidson Financial Services offers both wholesale and retail financing options.
Over the years, Harley-Davidson (NYSE:HOG) has become a key player in motorcycle culture and has drawn a devoted worldwide fan base with its distinctive style, powerful engines, and customization options. Besides making motorcycles, the company also offers a range of branded merchandise that promotes a lifestyle that resonates with its community and has a stronghold in the luxury motorcycle segment.
Based on 16 analysts’ ratings, Harley-Davidson (NYSE:HOG) has a consensus rating of Moderate Buy. The average price target of $42.60 represents an upside of 19.13% from the current levels, as of August 5.
Harley-Davidson (NYSE:HOG) has been a renowned name in the motorcycle industry since 1903 and has been making significant strides with its diverse offerings. In the second quarter, the financial performance of Harley-Davidson Financial Services (HDFS) was particularly notable, with revenue increasing by $23 million, or 10%. The growth came from higher retail and commercial finance receivables and improved returns as the financial portfolio adjusted over time. Currently, HDFS finances about 70% of new and used Harley-Davidson motorcycles in North America.
In Q2, a standout achievement was the dramatic 379% rise in sales of electric motorcycles compared to the same quarter last year. LiveWire’s appeal continues to grow, as evidenced by a significant boost in unit sales, placing it as the top on-road electric motorcycle seller in the U.S. for the first half of 2024.
Harley-Davidson’s (NYSE:HOG) presence in Europe is expanding as well as the LiveWire One and Del Mar models are now available. Additionally, in late June, the company introduced the STACYC Electric Balance Bike to the EMEA market, as it aims to diversify its offerings and attract new customers. LiveWire also saw a 12% improvement in operating losses from the previous year, which reflects management’s efforts to cut costs while expanding the product range and market footprint.
Harley-Davidson (NYSE:HOG) was part of 29 hedge funds’ portfolios in the first quarter with a total stake value of $822.132 million. H Partners Management is the most prominent shareholder in the company and has a position worth $516.132 million as of Q1.
9. Ralph Lauren Corporation (NYSE:RL)
Average Price Target Upside as of August 5: 22.03%
Number of Hedge Fund Holders: 43
Ralph Lauren Corporation (NYSE:RL) is a renowned American fashion house and one of our top luxury stocks according to analysts. The company is a symbol of luxury and classic American aesthetics.
Ralph Lauren (NYSE:RL) has become a prominent global name in designing, marketing, and distributing high-end lifestyle products, including clothing, accessories, home decor, and fragrances. The company’s signature lines, like Polo Ralph Lauren and Ralph Lauren Collection, are known for luxury and refinement.
Ralph Lauren (NYSE:RL) has a Moderate Buy rating as per the consensus opinion of the 22 analysts that have covered it. As of August 5, the average price target of $195.00 represents an upside of 22.03% to the stock’s current price.
Ralph Lauren (NYSE:RL), a major player in the global apparel market, continues to show strong performance despite recent challenges. On July 25, TD Cowen analyst John Kernan lowered the price target on the stock to $196 from $202 and kept a Buy rating. This adjustment reflected broader concerns about the apparel sector in China, including policy risks and competitive pressures. Despite these challenges, the company exceeded profit expectations for the first quarter, driven by steady demand for its high-end denim and polo shirts, particularly in Europe and China.
Ralph Lauren’s (NYSE:RL) net revenue grew by 1% to $1.51 billion, surpassing analysts’ average expectation of 0.46%, according to LSEG data. The company reported earnings of $2.70 per share, higher than the anticipated $2.47.
Ralph Lauren’s (NYSE:RL) sales in Europe and Asia increased compared to the previous year, a positive sign amid weaker earnings reported by other major European luxury brands like LVMH, Hugo Boss, Burberry, and Kering. Furthermore, the company has reaffirmed its forecast for low-single-digit revenue growth for the fiscal year 2025, indicating a stable outlook.
According to Insider Monkey’s database, 43 hedge funds held stakes in Ralph Lauren (NYSE:RL) in the first quarter, with positions worth $871.800 million. With 822,521 shares of the company, valued at $154.436 million, Marshall Wace LLP is the most dominant shareholder of the company as of Q1.
8. Inter Parfums, Inc. (NASDAQ:IPAR)
Average Price Target Upside as of August 5: 29.77%
Number of Hedge Fund Holders: 22
Inter Parfums, Inc. (NASDAQ:IPAR) is a prominent player in the global fragrance industry, specializing in the development, marketing, and distribution of high-end perfumes and colognes. The company manages an extensive portfolio of prestigious brands, including Montblanc, Jimmy Choo, Coach, and Kate Spade New York, and continues to expand with new additions like Lacoste and Roberto Cavalli.
Established in 1982 by Philippe Bénacin and Jean Madar, Inter Parfums (NASDAQ:IPAR) initially focused on the mass-market perfume sector. The company pivoted in the early 1990s to specialize in selective perfumery, aiming at the luxury segment.
On August 6, the company posted record revenues of $342 million and an EPS of $1.14, outperforming the market estimates by $4.3 million and $0.09, respectively. Management also confirmed sales and earnings forecasts for the full year at $1.45 billion and $5.15 per diluted share, respectively.
On July 23, Piper Sandler predicted Inter Parfums’ (NASDAQ:IPAR) move of sticking with its prior guidance as the firm believes that management has traditionally been cautious in making such adjustments and believes that the company is doing well despite some tough economic conditions. Piper Sandler maintained its Overweight rating on the company shares and raised its price target by $1 to $151.
Apart from Piper Sandler, Jefferies also has an optimistic view on Inter Parfums (NASDAQ:IPAR) stock and believes that it is oversold and said that its industry shows strength. On July 11, Jeffries upgraded the company stock to Buy from Hold with a $140 price target.
As of August 5, all five analysts that have covered Inter Parfums (NASDAQ:IPAR) maintain a Buy-equivalent rating. The average price target of $166 shows a 20% upside from current levels.
In the first quarter, 22 hedge funds had stakes in Inter Parfums (NASDAQ:IPAR) worth $185 million. Royce & Associates holds the most prominent position in the company with 489,283 shares worth $68.75 million as of the first quarter.
Headwaters Capital Management stated the following regarding Inter Parfums, Inc. (NASDAQ:IPAR) in its fourth quarter 2023 investor letter:
“Buys: Inter Parfums, Inc. (NASDAQ:IPAR): Inter Parfums is a leading fragrance house that partners with prestige brands to develop, manufacture, market and distribute perfumes globally under licensing agreements. IPAR was founded in 1982 by Jean Madar and Phillipe Benacin, who collectively own 44% of the company. Both founders are still actively involved in the company with Mr. Madar serving as the CEO of IPAR’s US operations while Mr. Benacin is CEO of the European business, Inter Parfums SA (publicly traded European subsidiary that is 72% owned by IPAR). IPAR focuses on licensing agreements with prestige brands that already have a devoted brand following in categories outside of fragrances. IPAR typically targets brands with fragrances that have either been under-managed or are relatively nascent but have large growth potential via a dedicated fragrance strategy. IPAR’s top fragrance brands include Montblanc, Jimmy Choo, Coach, and Guess. Over the last 2 years, IPAR has added fragrance licenses with Ferragamo, DKNY, Lacoste and Roberto Cavalli, all of which should meaningfully contribute to revenue growth for the company going forward.
The fragrance market is a niche category that requires scale and expertise that is better outsourced to a third party than managed internally by leading brands. The cost to design, market and distribute a fragrance line is too expensive relative to the potential revenue from the product. While top fragrance brands can generate revenue of $1-2 billion, most successful fragrance brands generate revenue in the $10-200mm range. Despite the small size, category extension into fragrances can still be a lucrative business for brands and serves to enhance the value of the brand if managed correctly. As a result, prestige brands often enter into licensing agreements with dedicated fragrance houses such as IPAR to manage their fragrance category. IPAR leverages their internal expertise that is required to design, manufacture, market and distribute a single fragrance over many brands…” (Click here to read the full text)
7. Capri Holdings Limited (NYSE:CPRI)
Average Price Target Upside as of August 5: 31.6%
Number of Hedge Fund Holders: 55
Capri Holdings Limited (NYSE:CPRI) is a multinational fashion holding company that owns several luxury brands, including Michael Kors, Versace, and Jimmy Choo. In August 2023, Tapestry, Inc. (NYSE:TPR), known for its brands like Coach New York and Kate Spade, agreed to acquire Capri Holdings (NYSE:CPRI) for $8.5 billion ($57 per share).
However, this acquisition faces regulatory scrutiny, with concerns raised by the U.S. Federal Trade Commission (FTC) regarding potential reductions in market competition and impacts on labor conditions. The outcome of this acquisition is anticipated to shape Capri’s (NYSE:CPRI) future trajectory as it seeks to expand its global footprint and maintain its competitive edge in the luxury fashion industry.
While the regulatory issues remain a concern for Capri (NYSE:CPRI), some analysts and experts are optimistic about its future regardless of the outcome. On June 25, Wells Fargo upgraded Capri (NYSE:CPRI) to Overweight from Equal Weight with a price target of $43. The firm thinks that the company’s stock price is too low compared to its real value. The stock is trading much lower than the $57 per share that Tapestry (NYSE:TPR) is offering.
Wells Fargo thinks there are three possible outcomes. The first one is that Tapestry (NYSE:TPR) wins a legal battle with the FTC, and Capri (NYSE:CPRI) shareholders get $57 per share. The second scenario is that if the deal falls through, the company might sell off its brands like Versace and Jimmy Choo and just keep Michael Kors.
The third is that Capri (NYSE:CPRI) could sell all its assets and not be bought by Tapestry. In all these cases, Wells Fargo believes the company’s stock has a lot of potential to increase in value.
In Q1, 55 hedge funds had stakes worth $1.05 billion in Capri Holdings (NYSE:CPRI). Pentwater Capital Management is the most significant shareholder of the company with 3.85 million shares worth $143.148 million.
6. Stellantis N.V. (NYSE:STLA)
Average Price Target Upside as of August 5: 51.5%
Number of Hedge Fund Holders: 35
Stellantis N.V. (NYSE:STLA) is a leading global automotive manufacturer that operates several well-known luxury vehicle brands such as Alfa Romeo, Chrysler, DS, and Maserati. The company sells its cars in over 130 countries and has manufacturing facilities in around 30 countries.
It is one of the largest and fastest-growing automotive brands in the world. Stellantis (NYSE:STLA) is committed to innovation and growth, especially through its ambitious electrification strategy and expansion of its product offerings. In Q1, 35 hedge funds had a stake worth $556.400 million in the company.
Even though the latest Q2 earnings were considered a little disappointing by experts and “humbling” according to the company’s management, Stellantis (NYSE:STLA) acknowledged its issues and is working to improve them.
The company’s adjusted operating income (AOI) margin fell to 10%, down from a record 14.4% in the previous year, and industrial free cash flow was negative EUR0.4 billion. The drop in AOI margin reflects higher manufacturing costs and lower volumes, while negative free cash flow was impacted by increased investment spending and working capital fluctuations.
Management is confident in a return to positive free cash flow by the end of the year, with plans to reduce investment spending by at least EUR1 billion in the second half.
On July 31, Nomura analyst Anindya Das upgraded Stellantis (NYSE:STLA) to a Buy rating from Neutral, adjusting the price target from EUR 24 to EUR 21. The upgrade is based on a positive assessment of company management’s commitment to addressing ongoing challenges in North America.
The analyst highlighted that Stellantis (NYSE:STLA) has made significant investments in the first half of 2024. These investments are aimed at launching a series of cost-effective new products in Europe. This strategic move is expected to position Stellantis (NYSE:STLA) more favorably to navigate headwinds from slower sales growth in the European market.
Moreover, the analyst noted that the company’s current share price presents an attractive valuation, which is further supported by a strong dividend yield of 10%. This yield offers a compelling incentive for investors, further supporting the Buy recommendation.
As of August 5, Stellantis (NYSE:STLA) has a consensus Buy rating among 27 analysts. The average price target of $23.84 represents a nearly 51.5% upside to its stock price at current levels.
5. Carnival Corporation & plc (NYSE:CCL)
Average Price Target Upside as of August 5: 52.78%
Number of Hedge Fund Holders: 56
Carnival Corporation & plc (NYSE:CCL) is a Florida-based company and one of the largest cruise companies in the world. It runs through four segments, NAA Cruise Operations, Europe Cruise Operations, Cruise Support, and Tour and Other. The company has 87 ships sailing under 9 brands including Carnival Cruise Line, Princess Cruises, Holland America Line, Seabourn, Costa Cruises, AIDA Cruises, P&O Cruises, and Cunard.
Carnival Corporation (NYSE:CCL) offers services related to leisure travel and has a strong market presence in the luxury travel segment, especially Seabourn and Cunard lines. The company provides cruise packages that have all-inclusive options that cover accommodations, meals, entertainment, and activities.
In addition to cruises, the company provides travel-related services including shore excursions, hotel stays before and after cruises and transportation. It also offers specialized cruises catering to different interests.
In the first quarter, 56 hedge funds had stakes in Carnival Corporation (NYSE:CCL), with total positions worth $1.5 billion. As of March 31, Point72 Asset Management is the largest shareholder in the company with a stake worth $208.494 million.
Carnival Corporation (NYSE:CCL) is one of the top luxury stocks according to analysts. The company is showing strong potential for growth, as highlighted by recent updates from financial analysts. On June 27, Argus raised the price target on the stock to $25 from $20 and kept a Buy rating. This upgrade follows a strong Q1 report where the company achieved record booking volumes at higher pricing. The company also enhanced the efficiency of its fleet. According to Argus, these factors suggest that the stock is currently undervalued, further supporting a positive outlook for the company’s future performance.
Similarly, on July 24, JPMorgan raised the price target on Carnival Corporation (NYSE:CCL) to $25 from $23 and maintained an Overweight rating. This adjustment reflects optimism based on recent observations and feedback from the company. The analyst noted that demand for cruises remains strong, with no signs of a slowdown in key performance indicators. As per the analyst, with a global vacation market valued at $1.9 trillion, the cruise industry is expected to capture a growing share of this expansive market.
Looking ahead to 2024, Carnival Corporation (NYSE:CCL) forecasts a 10.25% increase in net yields compared to 2023, surpassing earlier guidance. The company also expects an adjusted net income of around $1.55 billion, which is $275 million better than previous projections. These developments highlight the company’s strong market position and effective management, suggesting a promising future for investors.
Lastly, Carnival Corporation (NYSE:CCL) has a consensus Buy rating as per the 28 analysts that have covered it. As of August 5, the average price target of $22.00 implies an upside of 52.78% to the current levels.
4. Lululemon Athletica Inc. (NASDAQ:LULU)
Average Price Target Upside as of August 5: 54.24%
Number of Hedge Fund Holders: 51
Lululemon Athletica Inc. (NASDAQ:LULU) is a distributor and retailer of luxury athletic apparel, footwear, and accessories through the Lululemon brand for women and men. The company has more than 711 retail stores worldwide, with a significant footprint in North America and a growing international presence in markets like the UK, Germany, China, and Australia. The company operates through brick-and-mortar stores, which serve as community hubs, and its e-commerce platform allows customers to shop the brand’s full product range online.
Among 38 analysts that have covered Lululemon Athletica (NASDAQ:LULU), the average price target of $360.00 represents an upside of 54.24% to the current stock price, as of August 5. Furthermore, the stock was held by 51 hedge funds in the first quarter and the stakes amounted to $843 million. GLG Partners is the top shareholder of the company and has a position worth $182.88 million as of Q1.
Lululemon (NASDAQ:LULU) presents a compelling case for investment driven by its steady growth trajectory and strong market position. The company’s expansion strategy remains focused and effective, as can be seen by its consistent store openings and geographical diversification.
As of the first quarter, Lululemon operates 711 stores worldwide, which reflects a 14% increase in square footage compared to the previous year, with 49 net new stores added since Q1 2023. A highlight is the company’s strong performance in international markets, particularly in China Mainland where revenue surged by 52% in constant currency terms in Q1. The growth is a sign of Lululemon’s (NASDAQ:LULU) ability to resonate with diverse consumer bases across different regions.
During the Q1 2025 earnings call, CEO Calvin McDonald emphasized the significant untapped potential in international markets and suggested that non-North American operations could eventually contribute up to 50% of the company’s revenue.
Looking ahead to 2024, Lululemon (NASDAQ:LULU) remains committed to expanding its footprint and is targeting the opening of 35 to 40 net new stores. The expansion includes a strategic focus on both domestic and international markets, with plans to open five to 10 stores in the Americas and the remainder in key growth regions such as China Mainland. Such initiatives are expected to drive low-double-digit growth in square footage, reinforcing the company’s commitment to enhancing its retail presence.
Aside from physical retail, Lululemon (NASDAQ:LULU) continues to leverage its digital capabilities to grow sales and customer engagement. The company stands out as an attractive investment opportunity driven by its compelling growth prospects, expanding global footprint, and strong brand presence across diverse markets.
Ithaka US Growth Strategy stated the following regarding Lululemon Athletica Inc. (NASDAQ:LULU) in its first quarter 2024 investor letter:
“Lululemon Athletica Inc. (NASDAQ:LULU) is principally a designer, distributor, and retailer of healthy lifestyle inspired athletic apparel. It‘s moat is almost entirely based on its intangible brand asset. Of late, the company has benefited from both the longstanding athleisure fashion trend and the more recent pandemic-induced, work-from-home trend toward more casual attire. Approximately 45% of sales are generated across ~700 company-owned stores, 45% of sales (and growing rapidly) are generated online (lululemon.com), and ~10% of sales are generated by wholesale partners, which primarily comprise fitness studios. The stock’s underperformance was concentrated around the F4Q earnings announcement, which saw the company meet expectations for the current quarter but provide cautious commentary regarding tepid US consumer spending behavior.”
3. PVH Corp. (NYSE:PVH)
Average Price Target Upside as of August 5: 55.74%
Number of Hedge Fund Holders: 39
PVH Corp. (NYSE:PVH) is a New York-based apparel company and one of the top luxury stocks according to analysts. The company is engaged in designing and marketing a wide range of products, including dress shirts, neckwear, sportswear, swimwear, handbags, footwear, and more.
Its primary brands are luxury brands, Calvin Klein and Tommy Hilfiger. The company operates through Tommy Hilfiger North America, Tommy Hilfiger International, Calvin Klein North America, Calvin Klein International, and Heritage Brands Wholesale segments. The company’s products reach consumers through various channels, including department stores, chain outlets, and specialty shops, among others.
PVH (NYSE:PVH) has a Buy rating as per the coverage of 18 analysts. The average price target of $144.00 has an upside of 55.74% to the stock’s current price, as of August 5.
PVH (NYSE:PVH) reported earnings per share of $2.45 for the first quarter, which surpassed expectations by $0.26. It was driven by strong performances in key markets with a focus on higher-margin opportunities. Additionally, in North America, the company’s revenue jumped 3%, fueled by growth in direct-to-consumer and wholesale sales. Both Calvin Klein and Tommy Hilfiger segments experienced a 3% rise in revenue because of higher average orders and better conversion rates, along with reduced promotions.
In Asia Pacific, PVH (NYSE:PVH) achieved 3% revenue growth, led by strong direct-to-consumer sales, particularly in China. Despite economic challenges in Europe, the company navigated them by scaling back in low-margin segments and digital marketplaces to preserve sales quality and profit margins.
PVH’s (NYSE:PVH) inventory management was effective as it successfully reduced inventory by 22% year-over-year to $1.35 billion, minimizing excess stock and the need for heavy discounts. The company reported that clearance sales were cut by nearly 50%, which indicates the availability of fresher products and improved use of working capital.
Moreover, under the PVH+ Plan, PVH (NYSE:PVH) prioritizes enhancing shareholder value. The company repurchased $200 million worth of shares in Q1 and plans on further buybacks totaling $400 million for the year. In conclusion, despite economic fluctuations, PVH (NYSE:PVH) is focused on improving sales quality, efficient inventory management, and delivering value to shareholders.
In Q1, 39 hedge funds held stakes in PVH (NYSE:PVH), with positions worth $1.36 billion. As of the first quarter, Pzena Investment Management is the most significant shareholder in the company and has a stake worth $750.778 million.
FPA Queens Road Small Cap Value Fund stated the following regarding PVH Corp. (NYSE:PVH) in its first quarter 2024 investor letter:
“PVH Corp. (NYSE:PVH) is an apparel company that owns the Tommy Hilfiger and Calvin Klein brands globally. Most of PVH’s earnings come from Europe, where the Tommy and Calvin brands are considered “almost luxury” and PVH has generally recorded high single-digit organic growth with demonstrated pricing power during the preceding decade. CEO Stefan Larsson has done an excellent job revitalizing the company and improving margins at PVH’s moribund U.S. operations. Over the past year, PVH and our other apparel companies have performed well as the worst fears for consumer spending didn’t play out. PVH has become a top five holding for us and our apparel holdings (PVH, GIII, LEVI and DECK) now make up almost 10% of the portfolio. On April 2, post quarter end, PVH announced fiscal 23Q4 results where they missed on earnings guidance for the coming year. The stock is down ~20% from its high but now trades at less than ten times forward earnings. We have held our position.”
2. Signet Jewelers Limited (NYSE:SIG)
Average Price Target Upside as of August 5: 56.17%
Number of Hedge Fund Holders: 33
One of the top luxury stocks according to analysts, Signet Jewelers Limited (NYSE:SIG) has a market cap of $3.29 billion and is one of the world’s largest specialty retailers of diamond jewelry. The company runs around 3,600 retail stores under several renowned brands such as Kay Jewelers, Zales, Jared, and others while its luxury brands are H. Samuel, and Ernest Jones.
Signet Jewelers (NYSE:SIG) operates through three segments, North America, International, and Other. Beyond jewelry retailing, the company provides a range of services, including lifetime warranties on purchases, customization options, personalized credit solutions, and other offerings.
Signet Jewelers (NYSE:SIG) saw substantial benefits from its membership program in the first fiscal quarter of 2025, especially in its fashion segment, where loyalty’s impact is clear. By focusing on enhancing customer loyalty, the company achieved a notable 20-point increase in active members purchasing fashion items compared to last year.
The strategy not only retained existing members but also attracted new ones, including engagement ring recipients. It resulted in an over 25% increase in total membership since the end of the fiscal year 2024.
Signet Jewelers’s (NYSE:SIG) management banks on its strategy of targeted marketing that delivers personalized value based on each member’s unique preferences and shopping habits. The approach boosts customer satisfaction and supports the company’s broader goal of expanding merchandise margins.
The loyalty program was launched a few years ago and the company has rapidly grown it, as seen by a significant 25% rise in new users in Q1 alone. Additionally, active members making purchases increased by 50%, which shows the program’s effectiveness in driving engagement and sales.
In Signet Jewelers’s (NYSE:SIG) Q1 2025 earnings call, Gina Drosos, Chief Executive Officer of the company, mentioned that the company uses its consumer data platform, personalized marketing content, and messaging to precisely target customers with tailored content and messages.
This strategy enhances product visibility and appeals to individual preferences. By strengthening customer relationships and optimizing sales opportunities, the company aims to utilize its membership program as a fundamental driver of future growth. Signet Jewelers (NYSE:SIG) is well-positioned to further its position in the competitive retail jewelry market due to the company’s continued efforts of refined personalized marketing initiatives and expansion of its loyal customer base.
As per the consensus opinions of the 8 analysts that have covered Signet Jewelers (NYSE:SIG), the stock is a Moderate Buy. The average price target of $119.00 implies an upside of 56.17% to the present levels, as of August 5.
Moreover, in Q1, 33 hedge funds had investments in the stock, with positions worth $988.413 million. Select Equity Group is the top investor in the company with a stake worth $676.05 million, as of March 31.
1. Coty Inc. (NYSE:COTY)
Average Price Target Upside as of August 5: 79.93%
Number of Hedge Fund Holders: 22
Coty Inc. (NYSE:COTY), a subsidiary of JAB Beauty B.V., is a well-established international beauty corporation that is engaged in manufacturing, marketing, distributing, and selling a diverse range of products, including fragrances, color cosmetics, and skincare. Organized into Prestige and Consumer Beauty segments, the company has a global clientele and offers both luxury and mass-market items across over 130 countries and territories.
The company has a portfolio that includes 50 iconic brands in the cosmetics, skincare, and fragrance categories. The company has many luxury brands in its portfolio, including Calvin Klein Fragrances, Marc Jacobs Fragrances, Kylie Cosmetics, Lancaster, and more
Among 20 analysts that have covered Coty (NYSE:COTY), it has a consensus rating of Moderate Buy. The average price target of $13.00 implies an upside of 79.93%, as of August 5. It is the first stock on our list of top luxury stocks according to analysts.
On June 11, Piper Sandler lowered the price target on the stock to $13 from $15 and kept an Overweight rating. According to the firm, during the second quarter, the primary emphasis in the beauty and wellness sector was on consumer spending habits and the necessity for promotional efforts.
Coty (NYSE:COTY) is actively expanding its Prestige Beauty division to capitalize on the growing prestige beauty market, driving overall company growth. According to the research firm Circana, the dollar sales in the US prestige beauty industry grew by 14% year over year in 2023, reaching a total of $31.7 billion.
As of the FQ3 of 2024, Coty’s (NYSE:COTY) Prestige business (based on high-end premium products) accounted for 63% of the total sales and reported net revenues of $867.2 million, a rise of 8% on a reported basis and a robust 13% on a like-for-like basis during Q3. It highlights the company’s sustained performance in the high-end beauty market.
Geographically, Coty’s (NYSE:COTY) Prestige business saw significant expansion across all regions, with notable outperformance in Asia-Pacific, Europe, the Middle East, Africa, and the Travel Retail channel. This success is evidence of the effectiveness of the company’s localization and market penetration strategies.
Driving the double-digit growth in e-commerce within the Prestige segment were new product launches like Cosmic Kylie Jenner and Marc Jacobs Daisy Wild. These launches, combined with social media campaigns and collaborations with e-retail partners, not only boosted online sales but also, improved brand visibility and consumer engagement in digital channels.
At a stake value of $116.903 million, 22 hedge funds held positions in Coty (NYSE:COTY) in the first quarter. As of Q1, Sea Cliff Partners is the biggest shareholder in the company and has a position worth $29.1 million.
ClearBridge Mid Cap Strategy stated the following regarding Coty Inc. (NYSE:COTY) in its fourth quarter 2023 investor letter:
“Our holdings in the consumer staples sector also helped drive performance. Restaurant foodstuff distributor Performance Food Group continues to benefit from greater consumer spending on dining. Likewise, Coty Inc. (NYSE:COTY), the global beauty company comprised of a market-leading prestige fragrance business and mass cosmetic business, reported strong quarterly earnings with outperformance across all geographic regions and operating segments. With the continued strength of the prestige fragrance market globally, we believe the company’s fundamentals have improved much more than the stock’s valuation.”
While we acknowledge the potential of Coty Inc. (NYSE:COTY) to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
Read Next: Analyst Sees a New $25 Billion “Opportunity” for NVIDIA and Jim Cramer is Recommending These 10 Stocks in June.
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