$RMS (-0,12%) and $MC (-1,34%) both stand for luxury, but pursue different success models that complement each other ideally in the portfolio. Hermès impresses with its extreme exclusivity, strictly controlled growth, high margins and exceptional pricing power. The artificial scarcity of products ensures stable demand - even in economically weaker phases. The downside: growth is deliberately limited and the share is usually traded at a high valuation.
LVMH, on the other hand, plays to its strengths through diversification and size. The group combines numerous iconic brands in fashion, leather goods, spirits, watches and cosmetics and benefits more from global consumer and travel trends. As a result, LVMH offers more growth potential, but is also more cyclical and more susceptible to fluctuations than Hermès.
Together, the two stocks form a strong luxury duo: stability and exclusivity meet breadth and economies of scale. For long-term investors, this combination can help to exploit opportunities in the luxury segment and better diversify risks.
How do you see it? Would you opt for Hermès or LVMH - or would you put both in your portfolio?
