London Fashion Week: Luxury fashion brands are outpacing their high street counterparts in the stock market
- Data shows that LVMH and Hermès shares have performed well over the past five years
- Retail companies such as Zara’s Inditex have seen lower growth, the findings show
London Fashion Week kicks off on Friday and runs until Tuesday, September 19, but which top brands are best placed to keep your investment portfolio looking chic?
Analysis from trading platform eToro shows that luxury fashion shares have more than quadrupled the returns of their high street counterparts over the past five years.
The top 10 luxury fashion stocks, including LVMH and Hermès, have recorded a growth rate of 90 percent over the past five years, compared to 23 percent among their high street counterparts, the data shows.
The figures cover the ten largest UK and European luxury and high street fashion retailers by market capitalization and demonstrate a degree of resilience in parts of the luxury market during the cost of living crisis.
Growth: LVMH shares have done well over the past five years, eToro data shows
According to eToro, luxury brands have surpassed Europe’s Stoxx600 by a ratio of four to one in five years.
However, some high street brands have regained ground in the past year due to falling inflation and higher wages, the findings show.
Both luxury and high street retailers in Britain and Europe have outperformed the broader European stock market since 2018.
LVMH has seen its market value increase by 163 percent in the past five years, while Hermès has grown 241 percent in that period.
Since the start of 2023, Hugo Boss and Prada have seen growth of 30 percent and 21 percent respectively, while many well-known high street brands have seen more modest growth.
Spain’s Inditex, Zara’s parent company, has risen 21 percent in the past five years, behind Sweden’s H&M, which rose 26 percent.
Great Britain established Next shares have increased by 25 percent in the past five years JD Sports Stock has experienced a growth of approximately 47 percent in the recent period.
Asos was the worst performer, according to eToro, experiencing a significant downturn with a 94 percent decline in its stock market value.
Asos reported sales totaling £858.9 million in the third quarter of the fiscal year, down 14 percent from a year ago. In the year to date, Asos shares have fallen by about 25 percent, according to eToro figures.
Brands: Top 10 brands by market capitalization, according to eToro
Uphill struggle: Asos shares have struggled in recent years
Data: Luxury and High Street performance against Stoxx 600
Ben Laidler, global markets strategist at eToro, said: ‘The big brands deserve credit for navigating this tough economic environment well, with their collective share prices above the European share average.’
He added: ‘However, the fall in the share price of Asos, for example, is a stark reminder of how cutthroat and competitive the sector can be.
‘This underlines the importance of adaptability and innovation in the ever-changing fashion industry.
‘As the sector continues to evolve, we can expect further shifts in the fortunes of these mainstream brands.’
Keep in mind that while looking at the past is crucial when selecting stocks, they do not guarantee future growth.