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Hermes International SCA Unsponsored ADR
(OTC:HESAY)
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Rating:79Outperform
Price Target:
$197.00
▲(5.37% Upside)
Action:Reiterated
Date:07/30/26
The score is driven primarily by exceptional financial performance (strong growth, very high margins, strong cash generation, and low leverage) and a constructive earnings update with maintained outlook and robust H1 profitability. These strengths are tempered by weak technical positioning (below all major moving averages) and a premium P/E valuation despite the supportive dividend yield.
Positive Factors
Strong cash generation
Multi-year cash flow expansion supports durable financial flexibility: operating cash and free cash flow grew materially 2020–2025, enabling investment in workshops, store openings, dividends and buybacks without raising leverage. This strengthens strategic optionality and resilience to cyclical shocks.
Negative Factors
Material FX & hedging headwinds
Significant and persistent currency translation and hedging costs can erode reported revenue growth and operating cash in euro terms. Given global sales exposure, FX volatility is a structural earnings-driver risk that can compress margins and create unpredictable year-to-year reported performance absent sustained hedging gains.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Multi-year cash flow expansion supports durable financial flexibility: operating cash and free cash flow grew materially 2020–2025, enabling investment in workshops, store openings, dividends and buybacks without raising leverage. This strengthens strategic optionality and resilience to cyclical shocks.
Read all positive factors
Hermes International SCA Unsponsored ADR (HESAY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$193.59B
Dividend Yield2.57%
Average Volume (3M)18.44K
Price to Earnings (P/E)36.0
Beta (1Y)1.07
Revenue Growth10.20%
EPS Growth8.12%
CountryUS
Employees25,414
SectorConsumer Cyclical
Sector Strength84
IndustryLuxury Goods
Share Statistics
EPS (TTM)4.33
Shares Outstanding1,055,694,100
10 Day Avg. Volume28,746
30 Day Avg. Volume18,440
Financial Highlights & Ratios
PEG Ratio-9.12
Price to Book (P/B)11.74
Price to Sales (P/S)13.83
P/FCF Ratio52.18
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$215.00Price Target Upside15.00% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)5.11
Revenue Forecast (FY)$19.25B
Hermes International SCA Unsponsored ADR Business Overview & Revenue Model
Company Description
Hermès International Société en commandite par actions engages in the production, wholesale, and retail of various goods. The company offers leather goods and saddlery, such as bags for men and women, travel articles, small leather goods and acces...
How the Company Makes Money
Hermès makes money primarily by selling luxury products under the Hermès brand, with revenue driven mainly through direct-to-consumer retail sales in company-operated boutiques and via its e-commerce channels. A significant portion of sales typica...
Hermes International SCA Unsponsored ADR Earnings Call Summary
Earnings Call Date:Jul 29, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Feb 11, 2027
Earnings Call Sentiment Positive
The call presented a largely positive commercial and operational performance: solid revenue growth (accelerating in Q2), very high operating margin (41%), strong cash generation and disciplined inventory management, supported by continued investments in production capacity, retail expansion and sustainability. Key positives (revenue acceleration, margin, cash, regional strength in Americas/Japan/Europe ex France, job creation and vertical integration) outweigh the challenges. The main headwinds are material currency and hedging impacts that reduced reported growth, weaker perfume/travel-retail performance, a one-off exceptional tax contribution, and some supply-quality and regional geopolitical uncertainties. On balance, management conveyed confidence, reiterated medium-term revenue ambitions and committed to continued investment and quality preservation.Positive Updates
Solid Revenue Growth and Q2 Acceleration
Group revenue of EUR 8.2 billion in H1 2026, up 6% at constant exchange rates and up 2% at current exchange rates; Q2 revenue EUR 4.1 billion, up 7% at constant exchange rates (acceleration vs Q1).
Negative Updates
Significant Currency Headwinds
Negative exchange-rate effect of approx. EUR 360 million reduced growth by ~4.5 percentage points in H1 2026 (mainly weaker yen, U.S. dollar and Korean won versus the euro); hedging costs also material (close to EUR 100 million impact noted).
Read all updates
Q2-2026 Updates
Positive
Negative
Solid Revenue Growth and Q2 Acceleration
Group revenue of EUR 8.2 billion in H1 2026, up 6% at constant exchange rates and up 2% at current exchange rates; Q2 revenue EUR 4.1 billion, up 7% at constant exchange rates (acceleration vs Q1).
Read all positive updates
Company Guidance
Hermès kept its outlook unchanged, reiterating an “ambitious” medium‑term objective of revenue growth at constant exchange rates and giving quantitative guideposts: H1 revenue €8.2bn (+6% at constant exchange rates, +2% reported) with Q2 €4.1bn (+7%), operating income €3.4bn and operating margin 41%, gross margin 71.1% (+0.4ppt), adjusted available cash flow €2.2bn (up 18%) and total cash flow €2.7bn (up 16%); H1 bore a negative FX translation headwind of ~€360m (reducing growth ~4.5ppt) and ~€100m of hedging costs (management flagged hedging could rise toward ~€210m across the year) while the exceptional corporate contribution is estimated at €360m for the year (H1 ~€270m), restated net cash stood at €12.9bn and equity at €19bn (cash ≈50% of equity). Management said operating investments will accelerate (H1 €344m; full‑year target €1bn), they will add ~1 leather workshop per year through 2030 (≈300 jobs each), continue selective store openings and recruitment (600 hires in the quarter; >27,000 employees, 61% in France), and expect the conversion/translation effect to be close to neutral over the full year.Hermes International SCA Unsponsored ADR Financial Statement Overview
Summary
Income Statement
93
Very Positive
Balance Sheet
90
Very Positive
Cash Flow
88
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 16.23B | 16.00B | 15.17B | 13.43B | 11.60B | 8.98B |
| Gross Profit | 11.19B | 11.38B | 10.66B | 9.71B | 7.66B | 5.89B |
| EBITDA | 7.83B | 7.50B | 6.99B | 6.67B | 5.29B | 4.03B |
| Net Income | 4.54B | 4.52B | 4.60B | 4.31B | 3.37B | 2.44B |
Balance Sheet | ||||||
| Total Assets | 24.78B | 24.32B | 23.08B | 20.45B | 17.46B | 13.85B |
| Cash, Cash Equivalents and Short-Term Investments | 12.30B | 12.24B | 11.64B | 10.63B | 9.22B | 6.70B |
| Total Debt | 2.28B | 2.35B | 2.17B | 2.06B | 1.93B | 1.80B |
| Total Liabilities | 5.77B | 5.47B | 5.75B | 5.24B | 5.00B | 4.43B |
| Stockholders Equity | 19.02B | 18.84B | 17.33B | 15.20B | 12.44B | 9.40B |
Cash Flow | ||||||
| Free Cash Flow | 4.78B | 4.24B | 5.14B | 3.75B | 3.73B | 2.92B |
| Operating Cash Flow | 5.99B | 5.37B | 5.14B | 4.33B | 4.25B | 3.45B |
| Investing Cash Flow | -1.46B | -1.28B | -1.20B | -995.00M | -646.00M | -669.00M |
| Financing Cash Flow | -2.68B | -3.14B | -3.05B | -1.79B | -1.24B | -869.00M |
Hermes International SCA Unsponsored ADR Technical Analysis
Negative
186.96
Price Trends
186.89
Negative
189.18
Negative
213.83
Negative
Market Momentum
-1.23
Positive
45.81
Neutral
24.32
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HESAY, the sentiment is Negative. The current price of 186.96 is above the 20-day moving average (MA) of 183.23, above the 50-day MA of 186.89, and below the 200-day MA of 213.83, indicating a bearish trend. The MACD of -1.23 indicates Positive momentum. The RSI at 45.81 is Neutral, neither overbought nor oversold. The STOCH value of 24.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HESAY.
Hermes International SCA Unsponsored ADR Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $193.59B | 35.96 | 23.85% | 2.49% | 10.20% | 8.12% | |
67 Neutral | $3.35B | 11.22 | 16.01% | 1.47% | 1.35% | 661.25% | |
63 Neutral | $26.26B | 17.33 | 262.81% | 1.12% | 14.17% | 956.15% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
58 Neutral | $1.08B | 1.76 | 34.62% | ― | 194.57% | ― | |
57 Neutral | $1.43B | -16.64 | 21.10% | ― | 17.73% | -112.49% | |
49 Neutral | $1.64B | 10.96 | 88.57% | ― | -17.40% | ― |
* Consumer Cyclical Sector Average
HESAY
Hermes International SCA Unsponsored ADR
181.04
-62.77
-25.75%
TPR
Tapestry
129.82
31.43
31.94%
CPRI
Capri Holdings
13.77
-7.72
-35.92%
SIG
Signet Jewelers
81.02
-5.07
-5.88%
REAL
RealReal
11.65
4.04
53.09%
LUXE
LuxExperience
7.86
-0.58
-6.87%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.