RMS.PA · PAR · Consumer Cyclical
Hermès International Société en commandite par actions
Also onConsensus Drift
Implied value per share
EUR 1100.58
Market price
EUR 1331.50
Implied upside
-17.3%
5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case
Value Per Share
Same forecast, different terminal treatment. Percentages vs price.
Forecast Cashflows
Reporting currency (EUR). Outflows negative.
| Line | FY26 | FY27 | FY28 | FY29 | FY30 | CAGR |
|---|---|---|---|---|---|---|
| Revenue | EUR 17.8bn | EUR 19.8bn | EUR 22.1bn | EUR 24.6bn | EUR 27.3bn | +11.3% |
| EBIT | EUR 7.5bn | EUR 8.3bn | EUR 9.2bn | EUR 10.3bn | EUR 11.4bn | +11.3% |
| NOPAT | EUR 5.5bn | EUR 6.2bn | EUR 6.9bn | EUR 7.6bn | EUR 8.5bn | +11.3% |
| Add depreciation & amortisation | EUR 1.0bn | EUR 1.2bn | EUR 1.3bn | EUR 1.4bn | EUR 1.6bn | +11.3% |
| Less capital expenditure | EUR -1.1bn | EUR -1.2bn | EUR -1.4bn | EUR -1.5bn | EUR -1.7bn | +11.3% |
| Less increase in working capital | EUR -507.6m | EUR -565.0m | EUR -629.0m | EUR -700.1m | EUR -779.3m | +11.3% |
| Free cashflow to firm | EUR 4.9bn | EUR 5.5bn | EUR 6.1bn | EUR 6.8bn | EUR 7.6bn | +11.3% |
| Discount factor | 0.9574 | 0.8776 | 0.8045 | 0.7375 | 0.6760 | - |
| Present value | EUR 4.7bn | EUR 4.8bn | EUR 4.9bn | EUR 5.0bn | EUR 5.1bn | +2.0% |
| Present Value Of The Forecast | EUR 24.6bn | |||||
Discount Rate
Source shown per component. All overridable above.
| Risk-free rate | 3.20% | EUR assumption - no free live source available for this market (assumption) |
| Equity risk premium | 6.00% | Market assumption |
| Beta | 1.001 | Reported 1.001, pulled toward 1.0 (Blume) |
| Cost of equity | 9.20% | Risk-free + beta x equity risk premium |
| Cost of debt | 3.20% | Floored at the risk-free rate (implied cost of debt was lower) |
| Market capitalisation | EUR 139.5bn | 98.3% of capital |
| Total debt | EUR 2.3bn | 1.7% of capital, book value as a proxy |
| Tax rate | 25.8% | Effective, capped at statutory |
| WACC | 9.09% | E/V x Re + D/V x Rd x (1 - t) |
Terminal Value
Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.
Perpetuity growth at 2.50%
77% of EV
- Forecast FCFF, final year
- EUR 7.6bn
- Capex at depreciation, working capital in reinvestment
- EUR 8.5bn
- Less reinvestment at g/ROIC (9.2% of NOPAT)
- EUR -777.5m
- Capitalised
- EUR 7.7bn
- ROIC (reported)
- 27.3%
- Terminal value, undiscounted
- EUR 119.9bn
- Terminal value, discounted
- EUR 81.1bn
- Enterprise value
- EUR 105.7bn
- Less net debt
- EUR -9.9bn
- Equity value
- EUR 115.6bn
Exit at 17.0x EBITDA
86% of EV
- Terminal value, undiscounted
- EUR 221.7bn
- Terminal value, discounted
- EUR 149.9bn
- Enterprise value
- EUR 174.5bn
- Less net debt
- EUR -9.9bn
- Equity value
- EUR 184.4bn
Spread between methods: 46%.
Sensitivity
Value per share (EUR) by discount rate and long-run growth.
| Long-run growth | |||||
|---|---|---|---|---|---|
| Discount rate | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
| 7.09% | 1358.84 | 1442.60 | 1544.37 | 1670.76 | 1832.03 |
| 8.09% | 1163.09 | 1218.07 | 1282.69 | 1359.80 | 1453.48 |
| 9.09% | 1019.14 | 1057.06 | 1100.59 | 1151.09 | 1210.45 |
| 10.09% | 908.89 | 936.02 | 966.60 | 1001.36 | 1041.24 |
| 11.09% | 821.79 | 841.75 | 863.93 | 888.73 | 916.68 |
Outlined: this model. Green text: above today's price of 1331.50. Shading: distance from this model's own value.
Priced In
What each input would have to be to justify the current price, one at a time.
| Input | Model | Implied | Gap |
|---|---|---|---|
| Revenue growth, every year | 11.3% | 16.7% | +5.4pp |
| EBIT margin | 41.8% | 51.2% | +9.3pp |
| Discount rate | 9.1% | 7.9% | -1.2pp |
Live formulas, not pasted numbers - edit a driver and the workbook reprices.
Yahoo Finance and RBA data. General information, not advice. Methodology.