Burberry (LON:BRBY) is betting on growth in its smaller handbag business and playing up its trademark check, Bloomberg has reported. The news comes with new chief executive Marco Gobbetti seeking to turn around the retailer’s fortunes.
Burberry’s share price has inched marginally higher in London today, having added 0.15 percent to 1,757.00p as of 14:38 BST, slightly underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.32 percent higher at 7,238.74 points. The group’s shares have added just under 35 percent to their value over the past year, and are up by some 17 percent in the year-to-date.
Bloomberg reported today that at its first major runway show since Gobbetti took over in July, Burberry had showed reversible tote bags decked out in its tartan plaid.
“We have already established a very good platform in accessories and leather goods, but I think we have a great opportunity there,” the newswire quoted Gobbetti as saying in one of his first interviews since joining Burberry from French rival LVMH’s Celine. “I’m very confident that will be a big area of development for us.”
Gobbetti emphasized that Burberry will remain an apparel and outerwear brand, but noted that there were many more accessories in the pipeline, with other categories with a high potential for expansion including footwear.
Gobbetti took over the CEO role from Christopher Bailey, who has stayed on as creative director. Earlier this month, analysts at Credit Suisse turned bullish on the retailer, arguing that the group’s new management could successfully execute a brand turnaround strategy over the next two years.
The 27 analysts offering 12-month price targets for Burberry for the Financial Times have a median target of 1,670.00p on the shares, with a high estimate of 2,600.00p and a low estimate of 1,350.00p. As of September 15, the consensus forecast amongst 27 polled investment analysts covering the blue-chip retailer advises investors to hold their position in the company.