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Craftsmanship and Legacy at Hermès
This chapter examines Hermès' commitment to quality and craftsmanship that has sustained its luxury status for over 187 years. It highlights the brand's unique management philosophy, emphasizing the importance of family ownership and artisan integrity in a challenging market. Anecdotes about influential figures encapsulate the brand's dedication to exceptional artistry and its enduring legacy in the luxury industry.
On today’s episode, Clay is joined by Shree Viswanathan for a stock deep dive on Hermès. Hermès is a luxury goods manufacturer renowned for its high-quality craftsmanship. The brand is known for its iconic products, such as the Birkin and Kelly bags, silk scarves, and equestrian-inspired items.
Since the IPO in 1993, shares of Hermès have compounded at 20.6% (excluding dividends), while the S&P 500 had a total return of just 10.4%.
Shree Viswanathan is the founder and portfolio manager of SVN Capital.
IN THIS EPISODE YOU’LL LEARN:
00:00 - Intro
02:38 - A business overview of Hermès.
10:28 - Examples of Hermès thinking exceptionally long-term in their business strategy.
30:16 - The attempted takeover of Bernard Arnault.
37:59 - The strength of Hermès’ moat.
56:01 - The growth opportunities ahead for Hermès and the luxury industry more broadly.
01:03:22 - How Hermès approaches capital allocation.
01:14:15 - Shree’s thoughts on Hermès’ valuation.
01:29:51 - Risks that investors should monitor for Hermès.
And so much more!
Disclaimer: Slight discrepancies in the timestamps may occur due to podcast platform differences.
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