Equity valuation of Hermès International

Abstract

This dissertation aims to determine the best estimate of Hermès’ fair share value as of 26th February 2021 and provide an investment recommendation. The target price was obtained according to a weighted average of the Discounted Cash Flow, Relative Valuation, and Dividend Discount methodologies, supported by a comprehensive macroeconomic, industry, and firm analysis. The obtained fair share value was tested through a sensitive and alternative scenario analysis, accounting for the current economic uncertainty, and compared with the valuation performed by UBS. This dissertation sets a target price of €1,299.41 per share for Hermès, delivering a 39.4% upside potential and implying a buy recommendation.

Date of Award	30 Jun 2021
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	António Borges de Assunção (Supervisor) & José Carlos Tudela Martins (Co-Supervisor)