Friday, 29 August 2014

Hermes - delivering but expensive quality

I last talked about Hermes almost six months ago (link here) and concluded, broadly speaking, that the share was in a Euro220-280 range...which it continues within as shown by this three year chart:


Still the numbers released earlier were at face value much stronger than those of Prada who I wrote up yesterday (link here) continuing not only a positive trend in the H1 data this decade...

...but also with strong geographic divisional observations with none of the mixed aspects of the Prada disclosures.
Of course this is reflected in the rating too...at around x20 forward EV/ebit (with a 1% dividend yield).  Quality and delivery...yes.  You do pay for it however.  Something closer to the bottom of the recent range (sub Euro230?) feels better value for me. 

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