2Q/1H26 - Off the call / Updating estimates

研报英文原文证据摘录

2Q/1H26 - Off the call / Updating estimates

UpdateMpotentially important positive development could be growth in China reaccelerating

(so far it does not seem to be the case in 3Q, as per management comments). As per

our estimates, Hermès generates approximately 40% of its sales worldwide with

Chinese nationals (vs. ~32% for industry average). Should there be evidence that

Chinese demand for European personal luxury goods is re-accelerating, Hermès

would benefit disproportionately.

What's new? Hermès published its 2Q/1H26 results today pre-market (see our first

take here) and held a conference call.

Changes to our estimates: Overall, we update our model following 2Q26 results

and the conference call, lowering our 3Q26 and 4Q26 OSG estimates to +7.2% and

+7.4%, respectively, from +8.2% and +8.4% previously. This mainly reflects a

reduction in our 2H26 leather goods growth assumption to c.+11% from c.+12.5%.

Consequently, our FY26 revenue estimate moves marginally lower to €16.7bn, vs.

VA consensus at €16.8bn. Our medium-term view remains unchanged, with double-

digit growth still unlikely in 2027. Our new Price Target is €1,740 (vs. €1,850

previously).

Key takeaways from the call:

• Current trading: No change in trends observed for America, Japan, Korea, or

Europe into H2. Management said that the main questions remain France

(improved in Q2 vs. Q1) and the Middle East due to macro uncertainty.

• The Middle East has a -1.5pt impact in both Q1 and Q2. The region remains

resilient despite a much less dynamic environment than the previous double-

digit growth seen historically, but management see "nonetheless resilience".

Mgmt noted that the drop in footfall has largely been offset by an increase

in spend per client. The picture is complicated in Kuwait, Qatar and Bahrain,