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It has been a very difficult year Burberry (Lese: brby). I FTSE 250 the company was down 51% last year. Recently, it has reached its lowest rate over a period of ten years. However, many of the media has always reported the company’s strength to purchase. This causes a temporary increase in stock. Here’s what I think will happen next.
What we know so far
Let us first pass through what we know yet. During the past several reports of Bernard Arnault, the head of the power Lvmh Moët Hennessy Louis Vuitton state, is interested in buying Burberry. This may come indirectly with the Moncler clothing firm, with close association with LVMH.
Apparently, consumers are around due to the intense fall of burrger value, caused by stock price in 2024. Investors have been staying away from the shares following poor earnings reports, CEO changes and the recent downgrade of the FTSE 250. This reduced the market capitalization to £2.92bn. In contrast, LVMH has a market sum of £ 255bn!
In the same way that I might look at a stock and buy it because I think it’s undervalued, big companies can do the same. Firms are bought often because one company thinks it has a good value at that time.
To measure it
I have to be aware that nothing is legal on the way of a contribution that is Burberry (with my whole experience). The rise of the stock price recently is due to guessing guesses. If any fashioned EDA is, it will probably cost the current share. Therefore for people who buy now and make a right call, it is a potential method of making a quick profit.
There is nothing wrong with this, but it’s not something I’m busy doing. If it appears that there is nothing there, I think the Burberry Share price can drop too much. Or I think there will be time when I want to buy stock, it is not right now.
I think it will take time that the business is back in its case. Steps to reduce costs announced at the beginning of this summer should help. Sales in the key Asia Pacific region should grow again next year due to China’s recovery efforts and the region’s growth. But these are things that take time to sift through to the bottom line for profit. So, I want to keep my powder dry for now.
Investment strategy
If Burnberry was purchased at the end of the year, I will struggle my hat to those who bought stock waiting. But as a long-term investor, it is not compatible with my style. So, I don’t live in this yet, but I’ll look at the reports.
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