Bank of America has reduced its 2027 forecast for the global luxury sector after industry data tracked by the bank indicated that demand growth slowed during the third quarter to date compared with the previous three months.
According to the bank, global luxury demand decelerated by between 2 and 3 percentage points in the third quarter to date relative to the second quarter.
Bank of America attributed much of the slowdown to a more demanding comparison period. The bank said weaker trends were concentrated in July and the first two weeks of August, while conditions improved from mid-August through the first two weeks of September.
Bank of America Forecasts 4% Q3 Luxury Revenue Growth
Bank of America currently models luxury-sector revenue growth of 4% for the third quarter of 2026.
That would represent a slowdown of 3 percentage points from the second quarter, against a year-earlier comparison that the bank said is 6 percentage points more demanding.
The figures represent Bank of America’s estimates rather than reported results for the sector.
For 2027, the bank recently reduced its forecast and now expects overall luxury revenue to increase by 4%.
Within the sector, Bank of America forecasts 3% revenue growth for soft luxury and 6% growth for hard luxury.
Luxury Sector Valuation at Lower End of Recent Range
Bank of America said the luxury sector is trading at approximately 20 times earnings, placing its price-to-earnings multiple at the lower end of the 20-to-25-times range cited by the bank.
While Bank of America described the sector’s valuation as attractive, it also said it does not currently see a positive near-term catalyst.
The valuation assessment represents the bank’s market view and does not establish the future performance of luxury stocks.
The analysis is based on industry data monitored by Bank of America, while its third-quarter and 2027 figures remain forecasts and are subject to changes in consumer demand and broader market conditions.