The luxury fashion sector anticipates further growth in 2023, with reports projecting a 5-10% expansion by year-end. Factors contributing to this growth include increased disposable income among luxury consumers and an even more significant shift towards online shopping.

The American luxury goods market leads in annual revenue, accumulating approximately 65 billion U.S. dollars in 2020, followed by China's luxury goods sector at nearly 39 billion U.S. dollars. Japan, France, and Germany rank behind these top players.

LVMH

MC.PA

€781.70 -€0.30 -0.04%

Capital Structure

Market Cap

389.0B

Enterpr. Val.

421.1B

Valuation

P/E

25.3

P/S

4.5

Dividends

Yield

1.7%

Payout

41.2%

Revenue growth in these markets is expected to continue, with U.S. revenue predicted to reach around 81.5 billion U.S. dollars by 2025. Regarding stock performance, LVMH (Moet Hennessy Louis Vuitton SE) and CDI (Christian Dior) are two luxury fashion stocks worth considering for investment in 2023. $MC.PA+0.0% has experienced steady growth in recent years, thanks to strong brand recognition and customer loyalty. Strategic investments in digital marketing and e-commerce platforms have also helped the company maintain its competitive edge.

Christian Dior SE

CDI.PA

€739.00 €0.50 +0.07%

Capital Structure

Market Cap

133.3B

Enterpr. Val.

163.9B

Valuation

P/E

20.9

P/S

1.5

Dividends

Yield

1.8%

Payout

35.8%

A flourishing millionaire and billionaire population support the company's success, characterized by expanding profit margins, minimal debt, insider acquisitions, rising dividends, and increasing revenue. In contrast, $CDI.PA+0.1% has seen positive returns but more volatility due to its smaller size and lesser brand recognition. However, CDI's focus on innovation and new product development could boost its market share in 2023 as customers become more receptive to trying products from lesser-known brands.

Despite the one-day $30 billion loss in luxury stocks in May, driven by global demand and particularly from China, most luxury stocks have since recovered. LVMH and CDI are well-positioned for success in 2023, given their strong financials, customer loyalty, innovative product offerings, and strategic investments in digital marketing and e-commerce platforms. Investors should consider both stocks based on their individual risk-reward preferences.

Elon Musk, $TSLA+2.0% founder, and Bernard Arnault, $MC.PA+0.0% CEO and majority stakeholder, recently shared a midday meal at Cheval Blanc, an upscale hotel chain under LVMH's umbrella. While their conversation remains private, it's worth noting that LVMH is a significant social media advertiser, and Twitter, owned by Musk, relies heavily on advertising revenue.