Kering (ENXTPA:KER) Valuation Check After This Year’s Share Price Rebound and Recent Pullback

Kering (ENXTPA:KER) has quietly climbed this year, and with the share price hovering around €303 after a recent pullback, investors are starting to reassess whether the luxury group’s recovery has more room to run.

See our latest analysis for Kering.

The recent pullback sits against a strong backdrop, with a roughly 28 percent year to date share price return. This suggests sentiment toward Kering’s turnaround is improving even as the three and five year total shareholder returns remain deeply negative.

If Kering’s rebound has you rethinking luxury, it might also be worth scanning fast growing stocks with high insider ownership for other companies where insiders are backing strong growth stories with their own capital.

Yet with earnings recovering faster than sales and the share price edging above analyst targets, investors face a dilemma: is Kering still trading below its true potential, or has the market already priced in its next phase of growth?

Most Popular Narrative: 2.1% Overvalued

With Kering last closing at €302.55 against a narrative fair value of about €296, the current setup implies only a modest valuation premium.

The analysts have a consensus price target of €200.652 for Kering based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of €360.0, and the most bearish reporting a price target of just €135.0.

Read the complete narrative.

Want to see how relatively modest revenue growth, rising margins and a rich future earnings multiple all combine into this tight fair value band? The full narrative unpacks the exact profit trajectory and valuation assumptions driving that €296 call.

Result: Fair Value of €296.45 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, sustained weakness across key brands and slower Chinese demand could undermine the margin recovery story and force analysts to revisit those valuation assumptions.

Find out about the key risks to this Kering narrative.

Build Your Own Kering Narrative

If you want to stress test these assumptions or build an alternative view from the ground up, you can craft a full narrative in under three minutes, Do it your way.

A great starting point for your Kering research is our analysis highlighting 1 key reward and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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