We set a €58.6 target price for Moncler based on our DCF valuation methodology. Our DCF model comprises a 10-year explicit stage and a terminal value based on a 2.5% long-term growth assumption. We use a risk-free rate of 3.1%, an equity risk premium of 4.3%, and an adjusted beta of ~1.2x. Our WACC calculation points to ~8%. Our target price implies a FY26E P/E of ~24x at a slight premium to the luxury goods sector ex-Hermes. This reflects a number of factors, we think, including: 1) superior long-term revenue and earnings growth potential, including the transformation of Stone Island and solid FCF generation; 2) above-industry-average gross margin/EBIT margin; 3) differentiated brand positioning of the Moncler brand at the crossroads of luxury and sportswear/casualwear, offering a good degree of visibility; and 4) a strong management team with an anchor shareholder, LVMH (~4% indirect stake as of September 2025) providing a potential long-term exit strategy for Moncler Group's CEO and main shareholder Remo Ruffini.

We note the following risks to the shares achieving our target price:


Macroeconomic risk: Changes in apparel demand are correlated to the global macroeconomic environment and the health of consumer spending patterns. Any major change in the external political or economic environment that may directly or indirectly affect consumer sentiment is a risk to the outerwear jackets and coats growth trajectory.


Fashion risk: High fashion content at the core Moncler collection (over 90% of sales) is a risk at a time when consumers are perceived to be increasingly volatile. While this is mitigated by the ephemeral nature of the Genius project (limited edition collaborations), the latter accounts for less than 10% of group sales.


Product diversification: Moncler’s bread and butter remains the down jacket category, the brand’s DNA, accounting for ~75% of sales, while non-outerwear categories account for ~25% of sales – mainly knitwear and shoes. High dependence to a single category can become an issue for luxury brands, if the category loses relevance within consumers or if the competitive environment in the category intensifies.


Distribution risk: Retail capacity withdrawal in Europe and the US – particularly in multi-brand environments (e.g., department stores) could have a negative impact on the outerwear jackets and coat market, whose distribution is quite reliant on such distribution channels.


Price deflation: While the shift to online consumption represents a significant growth opportunity, particularly in markets/cities with limited physical distribution, it also fuels price deflation and a culture of promotional activity, in our view, which ultimately would impact brands’ gross margin and profitability.


Environmental concerns: While environmental factors are perceived to be of high relevance in developed markets, reflecting growing consumer awareness of the polluting nature of raw materials used for the manufacturing of apparel products, these concerns are growing in emerging markets, too. European and American brands have gradually adapted and put more emphasis on the transparency of raw materials sourcing, shifting to suppliers using certification standards, reducing waste, developing recyclable textiles and alternate eco-friendly materials and promoting animal welfare. The latter is particularly relevant in the down jackets market, for which most brands source down from goose or duck farms in some of the key producing countries (China, Hungary, and Poland). While luxury and technical brands have made significant efforts on disclosing the origin of down (generally as a by-product of birds that are killed for their meat), birds live-plucking practices are still common in the fast-fashion segment, as highlighted by International Down and Feather Bureau in their report. These cruel practices are likely to cause consumer backlash if exposed to the general public, we think.


Global warming: while winter jackets and coats may not be much needed in warm weather countries, global warming in key apparel markets such as the US, Western Europe and Japan could reduce the relevance of such outerwear garments.


Counterfeit: In 2016, the OECD and the EU’s Intellectual Property Office estimated the value of imported fake goods worldwide at US$509bn (3.3% of global trade), of which footwear, clothing and leather goods account for ~50% of the total value of seizures. Luxury goods contribute significantly to this figure, we think. From a government's point of view, high taxes on luxury products are good, as they are aimed at the wealthiest while generating additional tax revenue. However, the higher the taxes go the greater the incentive is to buy counterfeit products. While Moncler is by far not the most counterfeited brand, due to its more discreet, less “logo driven” product positioning, we believe that it is a factor to consider about the preservation of long-term brand equity, particularly in China and other EM where counterfeits are widespread.