A Bloomberg-driven headline on BofF [Business of Fashion] got our attention Monday morning: Hermès Can Surpass Vuitton as Luxury’s Biggest Brand, Citi Says.

Kit Rees cites Citibank analyst Thomas Chauvet’s April 12 note that making the case that “Hermès has potential to surpass LVMH’s flagship Louis Vuitton in the coming years.”

Chauvet is a Managing Director heading up Citi’s European Luxury Goods Equity Research team in London. He argues that based on Hermés, best-known for its Birkin bags, hitting the “symbolic” €20 billion ($21.3 billion) level by 2027 or before, they will be in a position to overtake Louis Vuitton, who reached that milestone in 2022.

Hermès generated group revenue of €13.4 billion in 2023.

How this argument of Hérmes overtaking Louis Vuitton by reaching $21.3 billion in 2027, when Louis Vuitton compounded at +10% 2023-27 gives us $34.3 billion in 2027 is absolutely a key reason why I don’t have Thomas Chauvet’s job.

According to my calculations, Hérmes must have compound growth of 15% to reach the 2022 Louis Vuitton milestone in 2027, with LV at 10% growth to achieve: Hermes $21.3 billion vs Louis Vuitton $34.3 billion.

Update: Given the reality that BoF will not pull back from this premise — that Hérmes can overtake Louis Vuitton by 2027 — based on my morning email on April 25, I agree that it’s possible, though unlikely that this will happen.

If Louis Vuitton grows at a compound rate of 2% and Hérmes only [not the small crystal brand and other small revenue sources] grows at a compound rate of 18% during the same period, it is theoretically possible that Hérmes and Vuitton would be in a tossup situation.

Do I believe that it’s likely that Vuitton will grow at 2% and Hérmes will grow at 18% over the same period? No.

This would not be the first “get clicks” article that BoF — who I hold in very high regard as a subscriber — has posted from Bloomberg.

Update: Given the reality that BoF will not pull back from this premise — that Hérmes can overtake Louis Vuitton by 2027 — based on my morning email on April 25, I agree that it’s possible, though unlikely that this will happen.

If Louis Vuitton grows at a compound rate of about 2% and Hérmes only [not the small crystal brand and other small revenue sources] grows at a compound rate of 18% during the same period, it is theoretically possible that Hérmes and Vuitton would be in a tossup situation in 2027.

Do I believe that it’s likely that Vuitton will grow at 2% annually and Hérmes will grow at 18% annually over the same multi-year period? No. It’s a totally preposterous idea in my view. But it’s theoretically possible.

Related: Sotheby’s wrote on Mar, 6, 2024: The Top 6 Most Expensive Hermés Birkin Bags. The Birkin bags in our collage come from this article.

About Thomas Chauvet Managing Director of Citi’s European Luxury Goods Equity Research

Digital data about Mr. Chauvet is sparse — REALLY sparse — but Tipranks.com —top of page 1 Google results rates him #1,006 out of 8,783 Wall Street Analysts and #2,417 out of 37,344 experts.

In the last year his success rate is 62% with 45 out of 73 ratings making a profit. His average return on those 45 positive ratings is 15.50%. I do not understand the intersection of these results with other data on his page, specifically 60.77 Hold, 35.36 Buy, 3.87 Sell of 181 ratings in the last year.

Anne of Carversville is not affirming the accuracy or reliability of Tipranks.com. We’ve never heard of the website. But it is a lead Chrome to Google search result for Mr. Chauvet. Safari to Google brings even tighter but similar results.