Goldman Sachs has lifted Tapesty, part of the Coach family, to the prime position within its updated coverage of the luxury accessories sector. In the midst of the second round of global lockdowns due to the Spring 2021 COVID-19 resurgence, Goldman Sachs has taken a more positive stance on the luxury accessories sector.
In a note to clients on Monday, Goldman Sachs analyst Brooke Roach upgraded Tapestry from Neutral to Buy, citing the company’s strong digital performance and its ability to adapt to the changing retail landscape. Roach also raised her price target on Tapestry from $35 to $45, implying a potential upside of over 20%.
Goldman Sachs’ upgrade of Tapestry is part of a broader shift in sentiment towards the luxury accessories sector. After a difficult 2020, where many luxury brands were forced to close stores and cancel events due to the pandemic, the sector has rebounded strongly in 2021.
The reopening of stores, the easing of travel restrictions, and the continued growth of online sales have all contributed to the sector’s recovery. Additionally, the rise of new trends, such as the athleisure trend, has also boosted demand for luxury accessories.
Goldman Sachs is not the only investment bank that is bullish on the luxury accessories sector. In a recent note to clients, Morgan Stanley analyst Kimberly Greenberger said that she expects the sector to continue to outperform the broader market in 2021.
Greenberger cited the strong performance of luxury brands in China, as well as the growing popularity of online shopping, as reasons for her optimism. She also noted that the sector is benefiting from the trend towards more casual dressing, which is driving demand for luxury sneakers and other accessories.
The luxury accessories sector is expected to continue to grow in the coming years. According to a report by Bain & Company, the global luxury market is expected to reach $383 billion by 2025, up from $283 billion in 2019. The growth is being driven by a number of factors, including the rising affluence of consumers in emerging markets, the increasing popularity of online shopping, and the growing demand for luxury experiences.
Goldman Sachs’ upgrade of Tapestry is a sign that the investment community is becoming more bullish on the luxury accessories sector. The sector is expected to continue to benefit from the reopening of stores, the easing of travel restrictions, and the continued growth of online sales. Additionally, the rise of new trends, such as the athleisure trend, is also expected to boost demand for luxury accessories in the coming years..
