Burberry still a ‘buy’ for Share Centre, despite sales drop

15th July 2015


As Burberry reports this morning, Helal Miah, investment research analyst at The Share Centre, explains what it means for investors…

Global brands group Burberry’s first quarter trading update reported a fall in like for like sales from the same period last year. The quarter saw a 6% rise in sales compared to 12% last year. They describe their market place as “challenging” The Asia-Pacific region was under pressure, especially Hong Kong and investors will remain nervous in light of recent events in China. However, growth in Europe and the Middle East was more robust and currency headwinds have reduced.

Their six strategies to boost earnings are: Inspire with the Brand, realise product potential, accelerate retail-led growth, unlock market opportunity, pursue operational excellence and build their culture. The company continues to target expanding its flagship stores in high profile international cities where it hopes to attract local, as well as travelling, luxury consumers. The group’s online offering and social media presence is improving brand awareness amongst younger tech savvy consumers.

After falling from highs in February the share price year to date is down by around 4% longer term attractions remain and it remains our favoured stock in the sector. The Share Centre currently recommends Burberry as a ‘buy’.

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