00:00Hermes plunging this morning. Sales missed analyst estimates. The Birkin bag maker has been hit by the disruption caused by
00:07the conflict in the Middle East.
00:08For more, we're joined by Bloomberg Opinion columnist Andrea Felstead with thoughts on Hermes and beyond. Good morning to you,
00:14Andrea.
00:14So what are your takeaways then from Hermes in a Birkin bag or any start you like?
00:20I think this has fed into a broader concern about Hermes. The shares have really fallen around 25% over
00:29the past year.
00:31They've really derated. They're on a forward earnings of about 33 times there. Five-year average is 48 times.
00:37You can see how much they've fallen back because there's a real worry is other designer labels have got.
00:44We've had this incredible reset of designers, lots of new creative directors. Hermes is still doing the same as it
00:51did.
00:53We've seen the resale values of the Birkin and Kelly bags actually moderate from the peak in 2022.
01:01That's sort of in line with the luxury boom and bust and in line with the values of Rolex and
01:05other highly traded coveted assets.
01:08So there's questions about is Hermes really as, you know, immune and really as touchable exactly as we thought?
01:18And this has fed into that, really.
01:20Yes, and maybe that's the back story in people's minds going into these numbers today then because you mentioned this
01:25a couple of days ago.
01:26There could finally be some competition. Where do we look for that?
01:30Well, the way we look for it is Chanel and obviously they're not listed so it's quite difficult.
01:35But we know, we've seen all the pictures of people, you know, the frenzy for the bags.
01:40Dior, LVMH just said Dior was selling well.
01:44So, you know, they're probably the two places that are the competition.
01:51You know, they're obviously the
01:51one.
01:51So,
01:51Right.
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