Bernstein Lifts Price Target, Forecasts for Kering Post-H1 Earnings

06:58 AM EDT, 07/29/2026 (MT Newswires) -- Bernstein raised its price target and EPS estimates for Kering (KER.PA), as analysts took note of the French luxury goods company's first-half conference call. "Management exuded confidence in their strategic turnaround. Gucci seems to be moving in the right direction in 2Q26A. An acceleration in 2H26E is expected, propelled by a wave of newness set to arrive in stores in end-July and, only to build further over the rest of 2H26. Saint Laurent and Bottega Veneta are growing; Balenciaga and McQueen on the mend. Jewellery is booming, while Eyewear remains strong. A significant improvement in margins, squeezed out through fixed cost efficiencies and an accelerated network clean-up, [provides] a further boost," according to a Tuesday note. Kering posted first-half revenue of 7.22 billion euros, representing a 3% reported decline but a 1% gain on a comparable basis. In the same period, recurring operating income reached 921 million euros, improving the recurring operating margin by 40 basis points year over year to 12.8%. "We leave this call more constructive than before, even if our Group FY26E top-line forecasts are largely unchanged, with higher growth at Gucci offset by lower growth at the other divisions. On Gucci, tougher comps could well be partially offset by stronger brand momentum, spurred on by new collections... We remain open to potential cost efficiencies and operating leverage at Jewelry and Eyewear, and now see Group EBIT% at 12.8% in FY26, with EBIT improvements extending to outer years," analysts said. Within this context, the research firm boosted its price target to 270 euros from 220 euros, with a market-perform rating, noting current valuations seem to "largely" price in the company's recovery. Bernstein also lifted its adjusted EPS forecasts for full-year 2026 and 2027 to 6.66 euros and 9.93 euros, respectively, from 6.13 euros and 9.86 euros.