LVMH vs Kering Which Should You Buy?

LVMH and Kering are two of the largest luxury goods companies in the world, both based in France and known for their prestigious brands. LVMH, helmed by billionaire Bernard Arnault, boasts iconic labels such as Louis Vuitton and Christian Dior, while Kering, under the leadership of François-Henri Pinault, owns Gucci and Saint Laurent. Investors closely monitor these stocks for their performance in the high-end fashion and luxury industry, making them key players in the market.

LVMH or Kering?

When comparing LVMH and Kering, 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 LVMH and Kering.

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. LVMH has a dividend yield of 2.15%, while Kering has a dividend yield of 5.59%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. LVMH reports a 5-year dividend growth of 16.19% year and a payout ratio of 48.75%. On the other hand, Kering reports a 5-year dividend growth of 16.17% year and a payout ratio of 64.15%.

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 LVMH P/E ratio at 22.89 and Kering's P/E ratio at 11.19. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. LVMH P/B ratio is 4.93 while Kering's P/B ratio is 2.01.

Growth Investors:

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

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $668.40 for LVMH and $255.00 for Kering. Over the past year, LVMH's prices ranged from $598.42 to $958.69, with a yearly change of 60.20%. Kering's prices fluctuated between $212.00 and $480.99, with a yearly change of 126.88%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.