While maintaining its "underperform" rating on Burberry shares, Oddo BHF has raised its target price for them from 880 pence to 920 pence, pointing to short-term performance that will be moderately impacted by a more difficult economic environment.

The broker said that a reduction in its risk premium and a slight fall in the beta assigned to the stock (from 1.5 to 1.45) have more than offset the rather modest impact of lower earnings forecasts in its DCF valuation.

The analyst says that the British luxury group's stock does not show a significant discount to LVMH multiples on a 2027 basis, already taking into account a notable recovery in profitability.

While in his opinion the share price reflects significant hopes for a recovery in the franchise, Oddo BHF says that it is more cautious beyond the near term, which shows signs of stabilization in relative performance compared to the sector.


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