Shares in Burberry soared more than 7% on Friday after the British luxury group said it had seen “strong rebound” in sales in the fourth quarter as the fashion industry starts to recover.
In an unscheduled trading update ahead of its March 27 financial year-end, Burberry BRBY,
The FTSE 100-listed UKX,
Burberry’s shares, which have risen close to 20% so far this year, were last up 7.5% at £21.35 in morning London trading on Friday.
Luxury goods brands, including Burberry BURBY,
Italian fashion group Prada PRDSY,
“Along with Prada’s positive current trading comments earlier this week, today’s Burberry announcement is further confirmation of supportive trends in Jan-March ’21, which is likely to read positively for the wider sector,” analysts at RBC Capital wrote in a research note to clients on Friday.
Sophie Lund-Yates, equity analyst at Hargreaves Lansdown, cautioned that a disruption to tourism spending could see Burberry’s normal revenue patterns disrupted for some time. “The share price valuation is some way above the ten year average, so the market clearly has faith in Burberry’s potential. There’s no denying the view from Burberry HQ just got a little brighter, but there’s still work to be done,” she noted.