Morningstar

Hermes International SA RMS

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Stock XPAR Rating as of
€1,693.00 +9.50 (0.56%)
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As of Delayed Price Open

Company Report

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Hermès Remains Resilient Amid Industry Downturn

Jelena Sokolova

We believe wide-moat Hermès International has carved out a unique niche in the luxury goods industry, which will provide it with continuing superior returns on capital. Hermes’ iconic leather bag styles (part of the EUR 7 billion leather goods segment) are in limited supply, supporting the brand’s exclusivity perception and providing the company with demand visibility and significant pricing power. Hermès Birkin and Kelly bags are sold in secondary markets and auctions for significantly higher than the initial purchase prices—an impressive feat for soft luxury goods.

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Price vs Fair Value

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RMS is trading at a LOCK|@L>TW% premium.
Price
€1,644.50
Fair Value
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Uncertainty
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1-Star Price
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5-Star Price
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Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Hermès benefits from unique positioning in the leather goods segment, supported by a supply/demand mismatch for its iconic bags.

Bears

Hermès expands production capacity in leather goods by around 6%-7% a year and could run into an overcapacity situation, should demand unexpectedly turn.

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Trading Information

Previous Close Price
€1,683.50
Day Range
€1,676.00–1,696.00
52-Week Range
€1,529.00–2,434.00
Bid/Ask
€1,692.00 / €1,693.00
Shares Outstanding
104.74M
Market Cap
€177.48B
Volume/Avg
5,853 / 97,170

Key Statistics

Price/Earnings (Normalized)
37.76
Price/Sales
11.05
Dividend Yield (Trailing)
1.07%
Dividend Yield (Forward)
1.07%
Total Yield
1.07%

Company Profile

Hermès is over 180-year-old family controlled luxury goods company best known for its Birkin and Kelly bags. Its biggest segments are leather goods and saddlery, accounting for over 40% of revenue; clothes and accessories (28% of sales); silk and textiles (6%); and other products such as perfumes, watches, jewellery, and home furnishings. Hermès has about 300 stores globally.
Sector
Consumer Cyclical
Industry
Luxury Goods
Stock Style Box
Large Growth
Total Number of Employees
26,494
Website
https://www.hermes.com

Competitors

Valuation

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Metric
RMS
CFR
KER
Price/Earnings (Normalized)
 37.7641.0660.70
Price/Book Value
 9.375.212.11
Price/Sales
 11.055.532.12
Price/Cash Flow
 31.5422.9813.15
Price/Earnings
RMS
CFR
KER

Financial Strength

Metric
RMS
CFR
KER
Quick Ratio
 4.102.030.70
Current Ratio
 4.993.101.99
Interest Coverage
 118.7314.541.62
Quick Ratio
RMS
CFR
KER

Profitability

Metric
RMS
CFR
KER
Return on Assets (Normalized)
 20.92%8.65%1.26%
Return on Equity (Normalized)
 27.45%15.82%3.60%
Return on Invested Capital (Normalized)
 23.57%10.01%2.56%
Return on Assets
RMS
CFR
KER

Luxury Goods Industry Comparables

Screen With Investor
1-Day Chart
Name
Price
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
Lvmh Moet Hennessy Louis Vuitton SE
LVMHF
—LOCK|@$$279B
 Lvmh Moet Hennessy Louis Vuitton SE ADR
LVMUY
LOCK|R<&&QtzLOCK|@!Y$279B
 Hermes International SA
HESAF
—LOCK|m$N$201B
 Hermes International SA ADR
HESAY
LOCK|MqCg@m%gLOCK|$%$201B
 Compagnie Financiere Richemont SA Class A
CFRHF
—LOCK|N^K$142B
 Compagnie Financiere Richemont SA ADR
CFRUY
LOCK|ybp%#mqLOCK|Lx$142B
 Christian Dior SE ADR
CHDRY
—LOCK|jKx%$94B
 Tapestry Inc
TPR
LOCK|<DRVGYDLOCK|TBjD$28B
 The Swatch Group AG ADR
SWGAY
LOCK|SJHpjcLOCK|L!?&$13B
 Capri Holdings Ltd
CPRI
LOCK|M>^#^@LOCK|LcJ$2B

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