(CercleFinance.com) – The stock ended the day up almost 3% (2nd largest increase in the CAC40) after the announcement of its sales figures for the 3rd quarter of 2023.
Hermès International revealed a turnover at the end of September 2023 of 10.06 billion euros, an increase of 16.9% (+21.7% at constant exchange rates) compared to the same period in 2022, ‘all regions showing strong performance’.
In the third quarter alone, its sales reached 3.36 billion, up 15.6% at constant exchange rates, ‘still with good momentum in Asia and America’, and despite a particularly high comparison base in Asia.
Following this announcement, Stifel maintains its ‘hold’ rating on Hermès shares with an unchanged price target of 1,850 euros.
The analyst reports that Hermès’ third quarter sales of +15.6% at constant rates exceed consensus expectations (+13%) and his own estimate (+14%).
According to the broker, these figures demonstrate a gradual normalization of growth compared to the +25% growth in the third quarter of 2022, which was very high in comparison.
Stifel highlights that from a regional perspective, the main drivers of beating analysts’ expectations were Europe (+18% vs. consensus of +14%), Americas (+20% vs. consensus of +10%) and Japan (+24% compared to consensus of +22%), while growth of +10% in Asia, excluding Japan, was in line with expectations.
As for current trends, the company did not observe any changes in October, the analyst reports.
Oddo BHF for its part reiterates its ‘neutral’ opinion on Hermès the day after the quarterly activity update, while adjusting its price target slightly from 1953 to 1912 euros, its valuation by DCF being impacted by the rise in the rate without risk.
‘Hermès remains, for us, one of the most beautiful franchises in the luxury industry (if not the most beautiful) but we think that the resilient nature of the title is a little overestimated by the market at present,’ warns analyst in charge of the file.
According to him, its sales are not completely immune to the slowdown in the sector, and the need to increase investments to satisfy customers should lead to some downward normalization of margin levels.
UBS, for its part, reaffirms its ‘buy’ recommendation on Hermès with a price target slightly increased from 2030 to 2046 euros, a new target which implies a potential increase of 18% for the French luxury house’s shares.
‘The figures for the third quarter, without slowing down trends and with double-digit sales growth in all regions, remind us of the uniqueness of the Hermès file, which is worth paying for’, estimates the broker
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