EssilorLuxottica - another solid quarter

EssilorLuxottica delivered another solid quarter, with sales beating estimates thanks to strength in North America and momentum in high-growth categories like smartglasses and myopia management. Fourth-quarter revenue came in at EUR6.8 billion, up 9.2% year-on-year, outpacing the forecast of 5.86%.

The company's North American business, which makes up about 40% of total revenue, grew 7.8%, helped by a rebound in sunglass sales, particularly at Sunglass Hut. China was another bright spot, with Stellest myopia lenses seeing a 50% surge in sales. Meanwhile, the integration of the Supreme brand, acquired for $1.5 billion, is adding another avenue for growth.

On the innovation front, Ray-Ban Meta smartglasses are gaining traction, with 2 million pairs sold since their 2023 launch. The company plans to scale up production to 10 million units annually by the end of next year. In the med-tech space, EssilorLuxottica is making a push into clinical ophthalmology, having acquired Germany's Heidelberg Engineering and Canada's Cellview Imaging, alongside receiving regulatory approval for its Nuance Audio eyewear.

EssilorLuxottica is positioning itself beyond traditional eyewear, leveraging AI, smart glasses, and medical technology for long-term growth. The company offers a mix of steady earnings from its core business and upside potential from these innovations.

This one would be a good portfolio addition, if you are looking for something new.