There is currently no dispute over who wears the crown of world’s wealthiest person, and it definitely isn’t Tesla Chief Executive Elon Musk.
The net worth of Bernard Arnault, founder, chairman and chief executive officer of LVMH Moet-Hennessy Louis Vuitton SE
MC,
stood at $210 billion as of Thursday, according to the Bloomberg Billionaire Index. That makes him the world’s richest by that marker, giving him a comfortable lead over Tesla’s
TSLA,
Musk, whose wealth stands at $180 billion. At times the two have been in a neck-and-neck race for that top spot.
LVMH shares closed at a record €883 on Thursday, lifting the French CAC-40
PX1,
to an all-time high. That followed forecast-beating first-quarter sales from the luxury giant, thanks to returning China shoppers as COVID-19 restrictions eased, and rebounding international travel that drove duty-free sales. Up 7% so far this week, LVMH shares rose another 0.7% on Friday to €890.
The stock surge padded Arnault’s fortune by $11.6 billion on Thursday, the second-largest single day gain ever for him and a fresh record fortune, according to Bloomberg. Musk didn’t do badly either: he increased his wealth by $3.83 billion on Thursday.
LVMH owns jewelers Bulgari and Tiffany, alongside fashion houses Louis Vuitton and Dior. Results released late Wednesday showed the luxury giant beating expectations across every division, led by fashion and leather goods, the latter of which is significant, noted Berenberg analysts.
“As the most profitable division, this also bodes well for margin development, which, and gives encouragement on China’s recovery from pandemic disruption,” said Berenberg analyst Graham Renwick, in a note to clients on Friday.
“This performance sets the standard for [first quarter] luxury reporting and gives encouragement on China’s recovery from pandemic disruption. Overall, we think these results continue to demonstrate LVMH’s strong momentum and best-in-class execution – again reaffirming its high quality and strong track record, which we believe investors are favoring in this uncertain macro environment,” said Renwick, who reiterated a buy rating on LVMH and lifted his price target to €960.
The luxury sector got another boost of confidence on Friday, after Hermes International SCA
RMS,
reported higher sales momentum in the first quarter, driven by a bump in tourism and new stores. The maker of Birkin handbags saw a 23% annual increase in first-quarter sales, and backed “ambitious” medium organic revenue growth targets.
Luxury stocks have seen an impressive rebound in 2023, albeit after a weak 2022 — LVMH shares fell 6% in 2022 as travel restrictions in China and overall economic worries weighed on shoppers. LVMH shares are up 30% so far in 2023, with Hermès up 36% and Christian Dior SE
CDI,
and Gucci owner Kering SA
KER,
up 26% and 21%, respectively.
As for Musk, his wealth is divided between businesses. While Tesla accounts for $76 billion, Bloomberg estimates his share of SpaceX is worth $49 billion, and his share of Tesla is worth nearly $10 billion.
This post was originally published on Market Watch
