Stifel downgrades its recommendation on EssilorLuxottica from 'buy' to 'hold', despite an adjusted price target of €201 to €203, a new target that implies 8% upside potential for the Franco-Italian optical giant's stock.

The broker acknowledges that EssilorLuxottica 'has once again demonstrated its defensive status (size, unrivalled brand portfolio) as growth accelerated in the US in Q4 2023' in its latest release.

Nevertheless, Stifel is cautious about management's operating margin targets for 2026, its own forecast being 50 basis points below the low end of the group's target range.

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