The biggest eyewear firm in the world makes thousands of house brand and designer frames in Italy and China and sells them around the globe. Know who it is? Read on.
Luxottica Group (NYSE: LUX) designs, manufactures, distributes and markets prescription eyeglass frames and sunglasses. The Manufacturing and Wholesale Distribution segment makes house brands, such as Ray-Ban, Persol and Vogue. It also provides designer lines, such as Chanel, Prada and Versace. The Retail Distribution segment runs a network of some 5,800 outlets, selling frames, sunglasses, watches and accessories. The stores are distributed throughout North America, Asia and Europe. The firm operates LensCrafters and Pearl Vision, the two leading North American retail optical chains, and Sunglass Hut, the leading North American sun specialty retailer.
The LUX share price popped above 30-day moving average support last week, on word of Luxottica's agreement to acquire
all of the outstanding shares of American competitor Oakley (NYSE: OO). It has since been consolidating the gain in a bullish "pennant" pattern. Stocks frequently exit pennants moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.
Brokers currently recommend the issue with two "strong buys". Analysts see a 15% average annual growth rate, through the nest five years. The LUX Price to Sales ratio (2.74), EPS Growth rate (19.79%), Return on Assets (8.94%), Return on Investment (12.30%), and Return on Equity (20.57%) compare favorably with industry, sector and S&P 500 averages.
Institutions hold about 4% of the outstanding shares. Over the past 52 weeks, the stock has traded between $25.07 and $38.83. A stop-loss of $33.60 looks good here.
Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.
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Reader Comments (Page 1 of 1)
6-28-2007 @ 4:48PM
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