Kering vs LVMH Which Offers More Value?

Kering and LVMH are two of the largest luxury goods conglomerates in the world, both based in France. Kering, formerly known as PPR, owns brands such as Gucci, Saint Laurent, and Balenciaga, while LVMH owns Louis Vuitton, Dior, and Moët Hennessy. Both companies have seen significant growth in recent years, with their stocks performing well in the market. Investors often compare the two companies, analyzing factors such as brand performance, financials, and market trends to determine which stock is the better investment.

Kering or LVMH?

When comparing Kering and LVMH, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Kering and LVMH.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Kering has a dividend yield of 8.13%, while LVMH has a dividend yield of 2.26%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Kering reports a 5-year dividend growth of 16.17% year and a payout ratio of 64.15%. On the other hand, LVMH reports a 5-year dividend growth of 16.19% year and a payout ratio of 48.75%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Kering P/E ratio at 10.16 and LVMH's P/E ratio at 21.02. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Kering P/B ratio is 1.82 while LVMH's P/B ratio is 4.53.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Kering has seen a 5-year revenue growth of 0.47%, while LVMH's is 0.85%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Kering's ROE at 17.77% and LVMH's ROE at 22.19%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $222.24 for Kering and $616.00 for LVMH. Over the past year, Kering's prices ranged from $220.18 to $480.99, with a yearly change of 118.45%. LVMH's prices fluctuated between $600.83 and $958.69, with a yearly change of 59.56%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.