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.

BOOKS AND RESOURCES

• Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Stig, Clay, Kyle, and the other community members.


• Shree’s fund: SVN Capital.


• Follow Shree on Twitter.


• Best Anchor Stocks write-ups on Hermès.


• Books mentioned: 100 Baggers, The Founder’s Mentality, The Luxury Strategy.


• Stewart Brand’s seminar on long-term thinking.


• Howard Marks’ podcast with Morgan House.


• Related Episode: WSB585: Concentrated Value Investing w/ Shree Viswanathan.


• Mentioned Episode: WSB645: The King of Luxury w/ Christian Billinger.


• Follow Clay on Twitter. 


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