Prada's Asia Bet Turns Trendsetter Into Luxury's Biggest Loser
- The fashion house's shares have plunged as margins narrow
- Analysts blame too many Asian stores and too few new products
The logo for Prada SpA.
Photographer: Jerome Favre/BloombergWhen Prada SpA on Monday outlined plans to rekindle growth, marketing chief Stefano Cantino boasted that the Italian luxury-goods maker still “sets the trend in the industry.” Unfortunately for Prada’s investors, it’s a leader in the wrong metrics.
The 103-year-old company, started as a Milan shop selling travel trunks and leather bags, has been the worst-performing major luxury stock over the past three years, with its shares down by 29 percent. It has missed its earnings forecasts in 11 of the past 12 quarters and its profit margin narrowed from 27 percent in 2012 to 14 percent last year.