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Hermès Still Looks Expensive At 50x P/E, 0.65% Dividend Yield

Mark Dockray profile picture
Mark Dockray


  • As was widely expected, Hermès posted exceptional full-year fiscal 2021 results, with strong growth in revenue, profits and its net cash position.
  • Fourth quarter figures imply a more subdued near-term, with the firm running up against production constraints and likely downward pressure on record-high margins.
  • That is largely to be expected, however, and doesn't detract from the company's great long-term prospects.
  • That said, the valuation remains pretty expensive, with the shares currently at a P/E of around 50x.

Hermes paris under construction on the street of kowloon

LewisTsePuiLung/iStock Editorial via Getty Images

For a while now, my main concern with Hermès (OTCPK:HESAY)(OTCPK:HESAF) has been the extent to which multiple expansion has been juicing overall shareholder returns. Sure, "quality growth" can undoubtedly be a great long-term winner - and I

This article was written by

Mark Dockray profile picture
I like to take a long term, buy-and-hold approach to investing, with a bias toward stocks that can sustainably post high quality earnings. Mostly found in the dividend and income section. Blog about various US/Canadian stocks at 'The Compound Investor', and predominantly UK names on 'The UK Income Investor'.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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