EQUITY RESEARCH: BURBERRY GROUP PLC

This Equity Research presents a valuation of the Burberry Group, conducted as part of the master’s in finance final work at ISEG – Lisbon School of Economics & Management. The analysis adheres to the standards set by the Chartered Financial Analyst (CFA) Institute. Burberry Group is a globally recognized British luxury brand, renowned for its rich heritage, timeless British style, and exceptional craftsmanship. The company holds a dominant market position in key product categories, particularly outerwear and scarves, and is recognized for its iconic trench coat and the signature Burberry Check pattern. Burberry was selected for this valuation due to its leadership within the personal luxury goods sector, unique British identity, and standing as a singular luxury brand. This valuation was supported by a macroeconomic and industry analysis, considering the company’s historical performance and future strategies to achieve its growth ambition. The Discounted Cash Flow (DCF) valuation model reached the price target, specifically using Free Cash Flow to the Firm (FCFF). The Adjusted Present Value (APV) method and a relative valuation based on market multiples (EV/EBIT, EV/Sales, and P/E ratios) were also employed to complement the analysis. This analysis yielded a price target of £9.73 as of 30th March 2025, representing an upside potential of 37.00% compared to the 27th September 2024 closing price of £7.10. Based on these results, the final investment recommendation is a BUY, with high risk.