Question

In: Finance

Use Bloomberg or Google Finance or Yahoo Finance, etc. generate a 10-year (Feb 1, 2009 to...

Use Bloomberg or Google Finance or Yahoo Finance, etc. generate a 10-year (Feb 1, 2009 to Feb 1, 2019) stock price comparison chart for Kering and Moet Hennessy Louis Vuitton SA (LVMH).

(a) whose performance is higher over the whole period

(b) whose is higher in the last five years

(c) the periods during which their performance was tightly-coupled and

(d) the point at which performance decouples. Finally, can you point to any specific strategic actions by Kering that might have led to the decoupling?

Solutions

Expert Solution

Please find answer as below:

a) As per share price comparison Kering share price has improved drastically over 10 years and even dividend also consistent and average dividend is higher than LVMH. Hence. Kering performance is higher in the whole period.

Share Price
Date LVMH Close Kering Close
28-02-2009 47.290001 44.8736
28-02-2010 86.540001 91.615303
28-02-2011 111.699997 100.518997
29-02-2012 128.850006 119.898003
28-02-2013 133.899994 159.307007
28-02-2014 131.949997 137.604004
28-02-2015 164.149994 168.973007
29-02-2016 150.5 163.199997
28-02-2017 205.850006 225.343994
28-02-2018 250.199997 361.368011
Dividend (Yr) LVMH Dividend per share Kering Dividend Per share
2009 1.6 3.3
2010 2 3.3
2011 2.2 3.5
2012 2.9 3.5
2013 3 3.75
2014 3.15 3.75
2015 3.3 4
2016 3.6 4
2017 4.2 4.6
2018 5.4 6
AVG DIV 3.14 3.97

b) In last five years Kering's performance is better.

Share Price
Date LVMH Close Kering Close
28-02-2014 131.949997 137.604004
28-02-2015 164.149994 168.973007
29-02-2016 150.5 163.199997
28-02-2017 205.850006 225.343994
28-02-2018 250.199997 361.368011
Dividend (Yr) LVMH Dividend per share Kering Dividend Per share
2014 3.15 3.75
2015 3.3 4
2016 3.6 4
2017 4.2 4.6
2018 5.4 6
AVG DIV 3.93 4.47

c) Between 2009 and 2012, if you observe from the above tables, their performances were overall in a competition, and was tightly coupled.

d) From 2013 onwards, Kering performance started improving a lot, and surpassed LVMH.

It took over Gucci to improve the market share.

It assesses all new suppliers for adherence.

It has introduced a vendor rating system to evaluate supplier's performance.

jeff jeffy answered 1 year ago
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