Is LVMH Fairly Priced After Flat 1 Year Return and 36.4% Gain Over 5 Years

• Wondering if LVMH Moët Hennessy - Louis Vuitton Société Européenne is still a luxury icon at a fair price, or if the market is quietly overpaying, you are not alone, and that is exactly what we are going to unpack.
• The share price has been treading water recently, down around 0.6% over the last week, 3.5% over the past month, and roughly flat at 0.1% over the last year, even though it is still up a solid 36.4% over five years.
• These muted near term returns come as investors digest a mix of macro headlines, from slowing global luxury demand in key regions to shifting travel and tourism patterns that affect high end retail, alongside ongoing brand investments across fashion, leather goods, and selective retail. Together, these factors have made the market more cautious on how much growth to price into a premium luxury leader like LVMH.
• Right now, LVMH scores a 2/6 valuation check score, suggesting the stock looks undervalued on some metrics but not others, and we will walk through those traditional valuation approaches before circling back at the end to a more holistic way to judge whether the current price really matches the long term story.

LVMH Moët Hennessy - Louis Vuitton Société Européenne scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: LVMH Moët Hennessy - Louis Vuitton Société Européenne Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model estimates what a company is worth by projecting its future cash flows and discounting them back to today in € terms. For LVMH, the model starts with last twelve month free cash flow of around €13.3 billion and uses a two stage Free Cash Flow to Equity framework.

Analysts provide explicit forecasts for the next few years, and these are then extrapolated by Simply Wall St so that cash flows gradually slow as the business matures. Under this approach, free cash flow is projected to rise to about €17.3 billion by 2035, with interim years such as 2029 expected at roughly €14.4 billion, all discounted back to their present value.

Aggregating these discounted cash flows yields an estimated intrinsic value of about €447 per share. Compared with the current market price, the DCF implies the stock is around 39.7% overvalued, suggesting investors are paying a premium over what the cash flow outlook alone can justify.

Result: OVERVALUED

Our Discounted Cash Flow (DCF) analysis suggests LVMH Moët Hennessy - Louis Vuitton Société Européenne may be overvalued by 39.7%. Discover 907 undervalued stocks or create your own screener to find better value opportunities.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for LVMH Moët Hennessy - Louis Vuitton Société Européenne.

Approach 2: LVMH Moët Hennessy - Louis Vuitton Société Européenne Price vs Earnings

For a mature, consistently profitable business like LVMH, the Price to Earnings, or PE, ratio is a useful yardstick because it ties the share price directly to the profits that ultimately support dividends and reinvestment. In broad terms, higher expected growth and lower perceived risk justify a higher PE, while slower growth or elevated risk should pull that multiple down.

LVMH currently trades on a PE of about 28.27x, which is well above the broader Luxury industry average of roughly 17.65x but below the peer group average of around 37.52x. To move beyond these blunt comparisons, Simply Wall St calculates a Fair Ratio, its proprietary view of what a reasonable PE should be after considering LVMH and its peers growth outlook, profit margins, risk profile, industry positioning and market cap. This makes it more tailored than simply lining up against an industry or a few competitors.

For LVMH, the Fair Ratio is estimated at about 31.05x, modestly higher than the current 28.27x, which suggests the shares trade at a slight discount to what the fundamentals might warrant.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1448 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your LVMH Moët Hennessy - Louis Vuitton Société Européenne Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce Narratives, the Simply Wall St feature that lets you attach a clear story to your numbers by spelling out how you think a company’s revenues, earnings and margins will evolve, connecting that story to a financial forecast and ultimately to a personal fair value estimate.

Available on the Community page used by millions of investors, Narratives are designed to be simple and accessible, helping you decide when to buy or sell by continuously comparing your Fair Value to the current market price, and then automatically updating as new information like earnings releases, macro news or company announcements comes in.

For LVMH, for example, one investor might build a more cautious Narrative anchored closer to the lower analyst price target near €434.6, focusing on prolonged weakness in Asia and margin pressure. Another might lean toward a more optimistic Narrative closer to the high end around €699 or the updated Fair Value of about €612.4, emphasizing sector recovery, digital momentum and brand strength. Each Narrative turns that viewpoint into a live, numbers backed roadmap for action.

Do you think there's more to the story for LVMH Moët Hennessy - Louis Vuitton Société Européenne? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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