Hermès Ferrari

Save…invest…repeat?

Marcelo Marini, tipping today in search of meaningful business…

red leather bag in close up photography
Photo by Jinsoo Choi on Unsplash

Hermès had another excellent year.

You better start saving…

Wedding…

Saturday we went to a wedding party, it was amazing, Priest to Party, all excellent… people create problems when there’s non… we tried to cultivate the classy our grandpa taught… but we couldn’t… there’s a gap… I did not get to know him… so I tried to use my father’s laws of being a great man… it worked.

Because some things don’t lose value with time…

Like an old fashion suit and tie.

How do most businesses make money?

If you want to eat tomatoes, you can buy tomatoes or rather Heinz Ketchup, or Fresh Pomodoro Sauce… When thirsty you can buy a cold Coke, or rather sip tap water…depending on where you live…Healthy or not… no one seems to be caring about their own lives, so they prefer to become an influencer, and activists for the bad on earth…

Because we know people don’t produce… nowadays they consume… we know the world’s outlook is going to be very bad in a few years… there’s no way AI will produce what we consume…

Not the case for hand made luxury…

Hermès is a Ferrari?

Let’s take the first half of the year as an example:

Summary: 

  • Revenue +25%
  • EBIT +28% *marg. 44% (42) 
  • Net Profit +36% *marg. 33% (30) 
  • Op. CF +31% 
  • FCF +21% 
  • EPS +36% 

Let us review Sales growth over 10 years compared with Net Income…

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Stunning.

What do most businesses do? They sell what their customers want… not Giorgio Armani, that does his own thing and nails it. You don’t need to follow the trends, just be classy.

Most companies sell us sugar water/salt water, sugar+tomatos, acrylic clothes… someone care? We have our questions…

We better like quality, not the plastic cars/clothes produced today…

How long it takes to trash fast-fashion clothes?

We better buy classy brands, sometimes they are worth 20 years!

Split the difference…

Do your own calculation…

Hermès returned 3019% over the last 18% years. 75,4% return over 1 year…

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Classy Business Model

Hermès stock returned 20,5% a year over 18 years.

What have most people done instead?

When they are willing to speak up, you can march and yell with “communities”, or rather do internal activism and be like your grandpa… a modest working-class guy, (today called “entrepreneur” on social media).

If you want to live a better life you can fake it, or make it and that can be done by saving and taking risks (working hard).

What gives you freedom? Fight against climate change or minding your own business?

Many kids don’t get it.

You change the world by being like your grandpa… not the social media influencers.

Our grandpa taught us to save, work hard, and buy quality over quantity. Mind our own business and family, responsibly. Be honest.

When most people try to be trendy… remember the old man… be you. No need regret or apologize.

Keep following the path…

Marcelo Marini

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About the author: Marcelo Marini Studant PRO

Marcelo Marini is a businessman, financier, and author. He writes the Independent Thinking Newsletter to more than 20,000 readers in 15 countries.

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