PARIS — Morgan Stanley is broadening from luxe to fast.
Claire Kent, Morgan Stanley’s chief luxury analyst, is expanding her research universe.
This summer, she plans to initiate coverage of several fast-fashion stocks, including Inditex, Hennes & Mauritz, Next, Marks & Spencer and possibly Benetton. “Most of these brands are competing for the same customer’s purse,” Kent told WWD. “Plenty of consumers might decide whether to buy a Gucci handbag, some Puma trainers or an outfit from Zara. The brands don’t compete directly, but indirectly.”
She also noted U.S. investors “typically cover the stocks in this way,” and so do “at least half of our European clients.”
Kent and her London-based team now cover Bulgari, Swatch, Burberry, Hermès and Gucci in luxury, and also Puma and Adidas. Kent noted that in the future, she would share coverage of Pinault-Printemps-Redoute, which controls Gucci Group, with Morgan Stanley retail analyst Rebecca Davis. That’s because the market capitalization of Gucci as a pure luxury play will shrink when the group is fully part of PPR.
News of Kent’s expanded role comes only days after Morgan Stanley made what it said was the “unprecedented” decision to suspend coverage of LVMH Moët Hennessy Louis Vuitton, due to the “untenable situation” created by the Paris court judgment that it was guilty of gross misconduct toward the French luxury group. As noted, the commercial court here ordered Morgan Stanley to pay LVMH at least 30 million euros, or $38.1 million at current exchange, for what the French firm described as a premeditated and systematic campaign to denigrate LVMH. Morgan Stanley investment bankers advise Gucci Group on acquisitions and other matters.
Morgan Stanley said it plans to appeal the decision. It is believed the investment firm has until mid-April to inform the court of its intention to appeal, and four months after that to table its case.