Since the last time I wrote about the French luxury fashion company and brand Hermès ( OTCPK:HESAY ) ( OTCPK:HESAF ) in July, its price has gone nowhere. Even year-to-date (YTD), its price has just about seenManika is a macroeconomist with over 20 years of experience in industries including investment management, stock broking, investment banking. She also runs the profile Long Term Tips [LTT], which focuses on the generational opportunity in the green economy. Her investing group, Green Growth Giants , tak ...

Group 1 - The luxury market is characterized by products that symbolize affluence, status, and exclusivity, including yachts, sports cars, high-end apartments, watches, and handbags [1] - The focus of investment strategies is on blue-chip companies with competitive advantages, industry-leading market share, and strong profitability, particularly in the US and European markets [2] - Dividend investing is emphasized as being primarily about free cash flow rather than just yield chasing, indicating a strategic approach to capital appreciation and aggressive dividend growth [2]

In accordance with the provisions of Article L. 233-8 of the French Commercial Code (Code de commerce) and Article 223-16 of the General Regulations of French Autorité des Marchés Financiers (AMF), Hermès international publishes each month, before the 15th day of the following month, the total number of voting rights and the number of shares comprising the share capital if they have varied from those previously published. ...

Hi there, welcome to my profile. My name is Eugenio Catone, I live in Italy and I am 26 years old. In 2023 I graduated in Business Administration and I am completing my studies. My interest in financial markets started about 5 years ago when I accidentally came across a video about trading. That was the spark that introduced me to a new world, but over time I realized that it was not my path: too many charts, lines, and not very concrete concepts for a pragmatic person like me. I needed something different ...

Here at Moats and Monopolies, we write exclusively about companies that we own in our portfolio , which has consistently beaten the S&P 500 since we began to share it here on Seeking Here at Moats and Monopolies, we look for the highest quality businesses around the world. We are part owners in companies with strong competitive advantages, high free cash flow margins, secure balance sheets and understandable business models.Our portfolio is openly shared exclusively on Seeking Alpha for you to follow along ...

Core Viewpoint - Hermes' stock is currently experiencing a 20% drawdown, attributed to fears of a global recession and a slowdown in China, which significantly impacts luxury demand [2][3]. Group 1: Market Concerns - The decline in Hermes' stock price is linked to investor fears regarding a potential global recession and a slowdown in the Chinese economy, which is crucial for luxury brands [2]. - There is a noted decrease in foot traffic from aspirational luxury clients in China, although Hermes' CEO indicates that Chinese consumers are still seeking high-quality products [3]. Group 2: Valuation Analysis - An inverse DCF model suggests that Hermes must achieve a 10% CAGR in Free Cash Flow over the next 20 years to justify its current valuation, with specific growth rates of 16% CAGR in the first five years, 12% in the next five, and 8% and 7% in the subsequent periods [4][9]. - The required revenue and operating income growth rates for the first five years are both set at 12% CAGR, indicating a strong expectation for performance despite current market conditions [8][9]. Group 3: Historical Performance - Over the past decade, Hermes has compounded its Free Cash Flow at a 23% CAGR, with a significant portion of this growth attributed to multiple expansion [5][9]. - Historical data shows that Hermes has previously faced similar inventory buildup issues, which have not resulted in long-term negative impacts on cash conversion [7]. Group 4: Competitive Landscape - Comparisons with LVMH indicate that while Hermes has a strong growth trajectory, it may not replicate LVMH's inorganic growth strategies, which could affect its valuation multiple [10][11]. - LVMH has achieved a 12% CAGR in Free Cash Flow over the past two decades, suggesting a robust luxury market potential that Hermes could tap into [10]. Group 5: Future Outlook - The company is expected to benefit from a "flight to quality" among consumers, which may insulate it from broader economic downturns [2][3]. - A potential further decline in stock price due to economic conditions could present an attractive buying opportunity for investors looking to increase their positions in Hermes [11].

Mahe, Seychelles, Aug. 26, 2024 (GLOBE NEWSWIRE) -- Beldex, a leader in privacy-centric blockchain technology, is set to launch the Hermes hardfork around September 5, 2024, at block height 3546545. Following the success of the Bern hardfork, Hermes represents a pivotal advancement in Beldex's mission to enhance network performance, interoperability, security, and decentralization. Advancing Privacy and Interoperability The Hermes hardfork, named after Hermes, the god of speed and communication, introduces ...

Still, there's more going for Hermès than not. The company's fundamentals are surprisingly strong, even considering that Chinese consumers have turned shy when it comes to luxury. Double-digit revenue growth, rising profits and robust margins all work in its favour. Additionally, HESAY's reduced P/E from last year indicates that there can be further upside to it moving forward. At the same time, the luxury market slowdown can't be taken lightly, especially when it has shown up starkly in some of its segment ...

Financial Data and Key Metrics - Revenue for H1 2024 exceeded €7.5 billion, up 15% at constant exchange rates, driven by strong customer loyalty and new customer acquisition [50][64] - Gross margin rate for H1 2024 was 70.6%, down from 72.2% in H1 2023, primarily due to currency hedges and lower sell-through rates [51] - Net income group share reached nearly €2.4 billion, a 6% increase compared to H1 2023, with net profitability nearing 32% [54] - Operating cash flow grew 8% year-on-year, reaching €2.8 billion, while operating investments are expected to accelerate in H2 to reach €1 billion [70] Business Line Data and Key Metrics - Leather goods and saddlery saw remarkable growth, driven by increased production capacity and sustained demand [47] - Ready-to-wear and accessories grew by 15%, supported by successful collections and footwear [47] - Perfume and beauty sector rose, supported by new launches like Oud Alezan and H24 Herbes Vives, while watches remained stable [48] - Other Hermès products, including jewelry and homeware, grew by 19% [48] Market Data and Key Metrics - All regions recorded double-digit growth, with France up 15%, Europe (excluding France) up 18%, Japan up 22%, and Asia (excluding Japan) up 10% [65][66] - The US market showed strong dynamics, with 13% growth in both Q1 and Q2, driven by a "flight to quality" sentiment among clients [24][25] - China experienced a drop in footfall, particularly among aspirational clients, due to economic factors like the real estate market [96] Company Strategy and Industry Competition - The company continues to invest in production capacity, with new leather workshops and upstream capacities for silk, metal hardware, and perfumes [55] - Hermès is expanding its distribution network with new stores in the US, Asia, and France, following a multi-local approach [43] - The company remains committed to sustainability, with investments in reducing CO2 emissions and biodiversity initiatives [61][62] Management Commentary on Operating Environment and Future Outlook - Management highlighted the resilience of the brand in a complex global economic and political environment, with strong momentum across all regions [40][64] - The company expects H2 2024 to remain uncertain but plans to continue creating jobs and investing in all divisions, including new store openings and product launches [72] - Inflation in cost of goods, particularly materials and salaries, is expected to impact pricing strategies for 2025 [29][30] Other Important Information - The company has 23,200 employees, with 62% based in France, and continues to invest in diversity and inclusion initiatives [37] - Hermès paid a €4,000 bonus to all employees in February 2024 and distributed shares under the Free Action Plan [44] - The company’s Moody ESG rating increased, reflecting its commitment to transparency and sustainability [63] Q&A Session Summary Question: Impact of currency hedges on H1 and H2 - The impact of currency hedges was around €60 million in H1 and is expected to be €160 million in H2 due to inventory sell-off [8] Question: Pricing strategy for 2025 - Pricing will be influenced by inflation in cost of goods, including materials and salaries, with a focus on maintaining coherence with historical strategies [28][29] Question: US market dynamics - The US market showed strong growth, with regional variations between the West Coast, East Coast, and Central regions like Texas and Florida [24] Question: Impact of Olympics on business - The Olympics are expected to disrupt business in France, similar to past events in London and Beijing, but the company has budgeted for this impact [27] Question: Gross margin pressure in H2 - Gross margin pressure is expected to continue in H2 due to currency effects and lower sell-through rates, particularly in Greater China [101][109] Question: Consumer behavior in China - Chinese consumers are becoming more sophisticated, focusing on high-quality products rather than logos, but footfall has dropped due to economic factors [96][97] Question: Impact of Japanese yen depreciation - The company increased prices in Japan at the beginning of 2024 and expects the yen to appreciate in 2025, which will influence future pricing strategies [101][102]

2024 FIRST-HALF RESULTS Local production 74% of objects produced in France C R E A T I O N A N D S A V O I R - F A I R E E M P L O Y M E N T A N D R E S P O N S I B I L I T Y Multi-local and exclusive 295 stores in 45 countries At the end of June 2024 • Enrichment of the leather goods collection with the models Della Cavalleria Élan and Kelly Mini clouté • Launch at the end of June of the eighth collection of Haute Bijouterie, Les formes de la couleur › L'Isle-d'Espagnac (Charente), scheduled in 2025 V E R ...