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Hermes International SA RMS

Morningstar Rating
€2,112.00 −56.00 (2.58%)
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Company Report

Hermes Continues Outperforming on Strong Brand, Lower Cyclicality, and Pricing

We believe wide-moat Hermes 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 more than EUR 5.5 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. Hermes 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.

Price vs Fair Value

RMS is trading at a 378% premium.
Price
€2,168.00
Fair Value
€3,914.00
Uncertainty
Medium
1-Star Price
€5,974.00
5-Star Price
€7,758.00
Economic Moat
Ncn
Capital Allocation
Bcwntdbtz

Bulls Say, Bears Say

Bulls

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

Bears

Hermes 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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News

Trading Information

Previous Close Price
€2,168.00
Day Range
€2,084.002,163.00
52-Week Range
€1,641.002,436.00
Bid/Ask
€2,108.00 / €2,115.00
Market Cap
€221.19 Bil
Volume/Avg
92,667 / 50,815

Key Statistics

Price/Earnings (Normalized)
49.48
Price/Sales
16.93
Dividend Yield (Trailing)
0.69%
Dividend Yield (Forward)
0.69%
Total Yield
0.75%

Company Profile

Hermes is a 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 around 40% of revenue; clothes and accessories (29% of sales); silk and textiles (7%); and other products such as perfumes, watches, jewellery, and home furnishings. Hermes has around 300 stores globally.
Sector
Consumer Cyclical
Industry
Luxury Goods
Stock Style Box
Large Growth
Total Number of Employees
22,067

Competitors

Valuation

Metric
RMS
MC
KER
Price/Earnings (Normalized)
49.4824.0512.70
Price/Book Value
14.935.992.53
Price/Sales
16.934.251.97
Price/Cash Flow
44.3415.938.60
Price/Earnings
RMS
MC
KER

Financial Strength

Metric
RMS
MC
KER
Quick Ratio
3.580.580.68
Current Ratio
4.401.321.38
Interest Coverage
99.3223.0912.44
Quick Ratio
RMS
MC
KER

Profitability

Metric
RMS
MC
KER
Return on Assets (Normalized)
24.29%11.43%8.33%
Return on Equity (Normalized)
33.36%27.46%20.97%
Return on Invested Capital (Normalized)
27.81%16.88%11.34%
Return on Assets
RMS
MC
KER
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Luxury Goods Industry Comparables

1-Day Chart
Name
Price
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
Lvmh Moet Hennessy Louis Vuitton SE ADR
LVMUY
CbjftyzlTsgy$395.0 Bil
Lvmh Moet Hennessy Louis Vuitton SE
LVMHF
Pfyff$394.5 Bil
Hermes International SA
HESAF
Yltr$245.5 Bil
Hermes International SA ADR
HESAY
TvfkykmmnzHpln$242.5 Bil
Christian Dior SE
CHDRF
Qhfz$135.4 Bil
Christian Dior SE ADR
CHDRY
Gfdq$135.4 Bil
The Swatch Group AG ADR
SWGAY
FtxxxrhjlKwmymv$10.9 Bil
Tapestry Inc
TPR
YxkhjyyPsrhbyt$9.7 Bil
Capri Holdings Ltd
CPRI
CtdkffykLjpjv$3.8 Bil
The RealReal Inc
REAL
JrlJlh$363.5 Mil

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