UBS released contrasting ratings on 2 major European consumer companies on Wednesday. The bank upgraded EssilorLuxottica to buy and downgraded Prada to neutral, highlighting sharply different growth expectations.
UBS upgraded EssilorLuxottica from neutral to buy with a €355 price target, implying 22% upside from the €303.70 closing price on Nov 24. The upgrade is driven mainly by the company’s smartglasses segment, which UBS believes could disrupt a €110 billion category by 2040.
UBS expects the company to post 10.1% organic sales growth in 2026, positioning it among the fastest-growing names under its coverage. The brokerage forecasts €30.11 billion revenue in 2026 with an EBIT margin of 17.1%. Shares trade at 38.1x 2026 P/E, with sales and EPS CAGR of 9% and 16% for 2025–2028.
A UBS Evidence Lab survey of 1,000+ US consumers showed nearly 80% intend to purchase smartglasses within 12 months. The biggest barrier was limited understanding of product functionality. Ray-Ban Meta reached 60% awareness among non-users, while no other brand crossed 10%. Existing owners were willing to pay 1.3x more than average respondents, suggesting strong pricing power.
UBS estimates EssilorLuxottica could secure 30% market share by 2040, equal to roughly €31 billion in revenue, though it assigns only 40% probability to this scenario.