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ESSILORLUXOTTICA

Analysis before buying or selling EssilorLuxottica shares

Trade the EssilorLuxottica share!
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If you are one of the investors who want to trade or buy EssilorLuxottica stock, we advise you to take note of all the information that will be useful for your analysis of this stock and that we will present to you in this article. We will explain who this company is and what are its main activities and sources of profits, present you its different competitors on the market as well as its recent partnerships or explain you how you can make a quality fundamental analysis of this stock and what are its advantages and disadvantages.

Elements to consider before selling or buying EssilorLuxottica shares

Analysis N°1

Innovation is of course at the heart of the group's strategy, whether it be the development of new products, services or marketing innovation. Investments in R&D will be of particular interest.

Analysis N°2

We will also have to monitor all the group's operations aimed at expanding its presence in new markets, particularly in the mid-range segment in developed countries.

Analysis N°3

Strategic partnerships with prescription laboratories and distributors as well as acquisitions of companies such as frames and accessories can also be significant events.

Analysis N°4

The diversification of EssilorLuxottica's product portfolio will also be a point to watch, as it could reduce the risks of exposure to a single segment.

Analysis N°5

Of course, it will be necessary to closely follow the competition of this company with the innovations of its main opponents and all the news of the sector likely to impact it in a direct or indirect way.

Analysis N°6

Finally, you should pay particular attention to the publication of the group's results and financial statements, and compare them with analysts' expectations and the objectives that the group has communicated to its shareholders.

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General presentation of EssilorLuxottica

A good knowledge of the EssilorLuxottica group is of course also essential if you want to be able to anticipate future movements in this stock. Here is a complete presentation of the group and its activities.

The EssilorLucottica group is a French company that operates in the medical supplies sector. More specifically, the company is the current world leader in the manufacture and sale of ophthalmic lenses, optical frames and sunglasses.

The group was created in 2018 through the merger of two major pioneers in this industry with Essilor, which specializes in advanced lens technologies and Luxottica which specializes in the expertise of iconic eyewear. The two companies are thus together setting new standards for visual equipment and eyewear and in terms of consumer experience.

The group holds several assets and popular brands such as Ray-Ban and Oakley in the eyewear segment, Varilux and Transitions in the field of ophthalmic optics technologies, and Sunglass Hut and Lenscrafters in the field of international distribution networks.

Analysis before buying or selling EssilorLuxottica shares
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The major competitors of EssilorLuxottica

Now that you are more familiar with the activities of the EssilorLuxottica group, you should also be aware of the companies that are likely to take market share from it and therefore its main current competitors, which we will present to you briefly here.

Carl Zeiss

First of all, this company is a company that specializes in precision optics and is also known worldwide for its high-end photographic lenses. However, the activities of this company concern six main divisions with microscopy, semiconductors, metrology, optronics, surgery and of course vision.

GrandVision

This other company is a Dutch group specialized in optical distribution. The company owns several brands such as Grand Optical, Solaris and General d'Optique. The company was founded in the 1990s by Daniel Abittan, who launched the Grand Optical and General d'Optique brands.

Hoya Corporation

This is a Japanese multi-disciplinary group that is included in the TOPIX 100 stock market index. The company was founded in 1941 in Tokyo and today employs over 35,000 people worldwide. The company was formerly known as Optical Glass Factory Hiroshi Azuma Inc.

Alcon 

This company is a Swiss pharmaceutical company that was founded in the United States. Its headquarters are now in Switzerland, in the canton of Zug, in Hünenberg. Previously, the company belonged to the Nestlé Group before being acquired by the Novartis pharmaceutical group in 2008. The company used to sell its products under the CIBA Vision brand and now under the Alcon brand.

National Vision Holding

This company is an optical retailer offering a variety of products and services to meet the eye care needs of its customers. It operates in a variety of sectors including the proprietary and host sector and the legacy sector.

Fielmann

Another direct competitor of Essilor-Luxottica is the German group Fielmann. It specializes in the distribution of lenses and ophthalmic equipment. The company is listed on the Frankfurt Stock Exchange and is part of the MDAX stock index.


The major partners of EssilorLuxottica

If the French company EssilorLuxottica has many adversaries in its sector of activity, it is also setting up interesting strategic partnerships in order to boost its growth and get ahead of these competitors. To help you better understand the value of this type of alliance, here are two recent examples:

Facebook 

First and foremost and in 2020, the group announced the signing of a multi-year strategic partnership with the giant Facebook. This partnership aims to develop a new generation of smart glasses. Mark Zuckerberg himself made the announcement during his annual Facebook Connect conference, which is broadcast live from California. Specifically, the partnership aims to bring together Facebook's applications and technologies with Luxottica's leadership and iconic brands and Essilor's expertise in eyewear to help consumers become more connected with their loved ones. The first product will be marketed under the Ray-Ban brand, the world's most popular eyewear brand. The product is scheduled to launch in late 2021 and will represent an innovation that brings together the strengths of both companies with technological innovation and style to create smart glasses that consumers will enjoy wearing.

Alibaba 

Previously, it was with Alibaba Rural Taobao that the group established an alliance to eliminate poor vision in China. Essilor announced this unprecedented collaboration between its inclusive economy division, 2.5 New Generation, and the Taobao network of Alibaba's online shopping platform to reduce poor vision in China's rural communities. Through this inclusive economy initiative, local optometrists have been touring rural areas in vans to offer eye tests to local residents. Once they have a prescription, they can then purchase 2.5 NVG glasses online from their local Taobao service center. The partnership aims to increase people's access to professional eye care services and raise awareness of vision health so that they can enjoy good vision by purchasing glasses if necessary.

CooperCompanies

Lastly, in 2021, EssilorLuxottica also created a 50/50 joint venture with CooperCompanies to acquire US-based SightGlass Vision. SightGlass Vision is a key player in the development of ophthalmic lenses to reduce the progression of myopia in children.

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Positive factors for EssilorLuxottica shares
The factors in favour of a rise in the EssilorLuxottica share price:

A coherent analysis of EssilorLuxottica stock also requires a comparison of the strengths and weaknesses of this company and therefore of the pros and cons of this stock. This is what we are going to help you do right now.

Let's start this comparative analysis by summarizing the advantages the group has to boost its growth in the years to come:

  • First of all, the group enjoys a strong reputation because it created Varilux, the world's first progressive lens that corrects presbyopia. It provides clear vision at near, intermediate and distance for its wearer.
  • Another advantage of the EssilorLuxottica group is its strong international presence. Indeed, the company's products and services can be found in more than a hundred countries around the world, with stores on all five continents.
  • Another undeniable advantage is that, since the merger between Essilor and Luxottica, the group benefits from both Essilor's position as one of the world's leading ophthalmic lens manufacturers, which dominates the market on all continents, and Luxottica's position as one of the most popular and profitable frame manufacturers in Europe and the rest of the world.
  • The group's various acquisitions have also enabled it to position itself as a leader in certain geographical areas, such as North America with the acquisition of FGX International.
  • Lastly, EssilorLuxottica can also rely on its strong reputation and brand presence in the rest of the world to reassure new customers and retain existing ones.
Negative factors for EssilorLuxottica shares
The factors in favour of a drop in the EssilorLuxottica share price:

Of course, the group also has to deal with a few weaknesses, as follows:

  • It should be noted that investments in research and development are still very high and are not yet fully covered by sales and marketing, which may have an impact on profitability.
  • Finally, the company is also poorly positioned in emerging markets, whereas its competitors are more so.
The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions or a solicitation to buy or sell an asset.

Frequently Asked Questions

What is the ownership structure of Essilor-Luxottica today?

Currently, EssilorLuxottica's capital is divided among several major shareholders, including Delfin Sarl, the Del Vecchio family's finance company, which holds 32% of the shares, FCPE for employees with 1.06%, Amundi Asset Management with 0.92%, Essilor with the employee savings plan with 0.28%, EssilorLuxottoca with 0.25%, William Blair Investment Management with 0.23%, Scout Investments with 0.17%, Texas Teachers' Pension Fund with 0.048%, Los Angeles Capital Management & Equity Research with 0.036% and Allianz Global Investors with 0.033%.

How was the EssilorLuxottica group created?

It was in 2018 that the merger between Essilor and Luxottica was finalized to create the group we know today. The Essilor company comes from a workers' cooperative created in 1849, the Association fraternelle des ouvriers lunetiers, which later became Essel. As for Luxottica, it was created in 1961 by Leonardo Del Vecchio, whose family is still the majority shareholder of the new group today.

What chart indicators should I use to analyze EssilorLuxottica shares?

To perform a good technical analysis of the EssilorLuxottica share price, you should preferably use several different trend indicators such as the MACD, stochastic indicators, Bollinger Bands, RSI, moving averages, pivot points and technical support and resistance levels.

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