Big watch brands are among the ‘quiet luxury’ stocks moving into investor’s portfolios

D.C. Hannay

I was recently struck by a CNBC headline, announcing that so-called “quiet luxury” stocks are quietly moving into the long-term portfolios of investors. Now, I’m not sure this new development is actually new, but I think perhaps the attention is a result of the recently trendy term. The hit HBO show Succession brought some heat to the phrase with the fashion choices of its characters, uber-high rollers who eschewed loud, logo-heavy looks for refined fabrics and muted colours. Their choices in timepieces also tended toward that same restrained aesthetic, a sort of “if you know, you know” stealth-wealth vibe that doesn’t feel the need to peacock. And a tasteful wristwatch is a much more subtle flex than a bigger display, such as a beachfront McMansion or a Huracán STO in Mantis Green.

Savvy investors have been long on luxury stocks for some time, as they can act as a hedge against inflation. And while there are several luxury watch brands that are still privately owned such as Rolex/Tudor, Audemars Piguet, Patek Philippe, and Chanel, there are publicly-traded conglomerates that count some rather well-known brands among their rosters. One more thing: it goes without saying, but I’ll say it anyway. We are not investment advisors, so caveat emptor, do your research, and only invest what you can afford to lose. Now, onto the companies and their brands.

LVMH

French luxury giant Louis Vuitton Moët Hennessy has done rather well of late, approaching their historic highs of last year. The Arnault family are the majority shareholders, and the diversity of companies in their stable is rather staggering. You’ll find world-renowned brands like Dom Pérignon, Christian Dior, Louis Vuitton, Marc Jacobs, Givenchy, and Rihanna’s Fenty Beauty brand of cosmetics in their portfolio, and it’s their diversity that has spurred steady growth. LVMH isn’t wanting for watch brands, either, and they count Louis Vuitton, Zenith, Hublot, Bulgari, TAG Heuer, Dior, Tiffany & Co., Daniel Roth, Chaumet, and the newly revitalised Gérald Genta in their stable. The next generation of Arnaults are firmly entrenched in the family’s watch business, too, with son Frédéric overseeing LVMH’s watch division, including the Zenith, Hublot, and TAG Heuer brands (having previously served as TAG Heuer’s CEO). His brother Jean now heads up Louis Vuitton’s watchmaking efforts, while Bernard Arnault’s youngest son Alexandre is a VP of Tiffany & Co.

Richemont

The Richemont Group is similarly diverse, with many fashion houses, including Chloé, Dunhill, Delvaux, and Peter Millar under the same umbrella. They even own a specialty manufacturer of hunting firearms, the British gunmaker Purdey, who’s famously supplied the royal family since the mid-1800s. But it’s the jaw-dropping watch and jewellery holdings that make up the bulk of Richemont’s arsenal. You’ll find heavy hitters like Cartier, Jaeger-LeCoultre, IWC, A. Lange & Söhne, Vacheron Constantin, Panerai, Piaget, Roger Dubuis, Van Cleef & Arpels, Buccellati, Montblanc, and Baume & Mercier among their holdings.

Swatch Group

If you live and breathe watches, you’re no doubt familiar with the range of brands under the Swatch Group banner. Even normal people caught wind of the headline-grabbing collabs between stablemates Swatch, Omega, and Blancpain, but the Swatch Group, while strictly a watchmaking enterprise, is the world’s largest, with over 30,000 employees. Besides Swatch, Omega, and Blancpain, the group also owns Breguet, Certina, Flik Flak, Glashütte Original, Hamilton, Harry Winston, Jaquet Droz, Longines, Mido, Rado, Tissot, and Union Glashütte, as well as movement manufacture ETA. Being less diverse than LVMH and Richemont, however, means they’re more susceptible to the inevitable fluctuations of the watch market.

And these three aren’t the only publicly traded stocks in the watchmaking business. Hermès is an established luxury brand that also manufactures fine timepieces, while both Seiko and Citizen have several brands in their quivers, including Grand Seiko and Credor (Seiko), as well as Frederique Constant, Arnold & Son, Bulova, Alpina, and the La Joux-Perret and Miyota movement manufactures (Citizen). So while you can’t buy stock in Rolex (as much as we might like to), there are plenty of options out there.