Place the onions in a large saucepan of boiling water, return to a boil, then drain and rinse. Peel the onions, then return them to the saucepan and cover with water. Bring to a boil, cover, then simmer until tender, about 10 minutes. Drain and set aside.
Place flour in saucepan, then gradually whisk in the broth. Stir in the milk and water, then season to taste. Cook until thick and bubbly, about 10 minutes. Add the onions and cook until thoroughly heated.
Remove from heat, then add the sage, thyme and sherry.