A lot of Estée LauderIt is (NYSE:EL) Perfumes and cosmetics make ideal holiday gifts for people who appreciate these products. Are shares of the famous company also a great buy for the season? If one analyst’s latest opinion on stocks is anything to go by, the answer is undoubtedly yes.
As the end-of-year holidays approach, this analyst reiterated her rather optimistic position regarding the company’s prospects. Here is his argument for attacking Lauder.
Last Friday, DA Davidson’s Linda Bolton Weiser released a new research note on Estée Lauder. In it, she maintained both her existing Buy recommendation on the stock and her $81 per share rating. price target.
Weiser’s latest update reportedly focuses on the company’s sales in China, a market currently grappling with relatively weak economic growth and a general decline in consumption.
The analyst pointed out that about 30% of sales are linked to China and that due to the rather volatile situation in the country’s economy, Estée Lauder recently suspended its annual forecasts. Weiser believes this market will continue to be a pain point for the company, contributing to a 15-16% year-over-year sales decline in its current (second) quarter of fiscal 2025 .
However, there are potential positives ahead, according to analyst DA Davidson. After a fairly exhausting takeover saga, Estée Lauder will soon see a refresh at the management level with the arrival on January 1 of a new CEO, company veteran Stéphane de La Faverie. According to Weiser, the stock price could be determined by his initial actions and remarks.
Personally, I believe that Estée Lauder, which is not the most innovative company in its field, does not have a huge potential for fundamental growth. However, its stock price is low enough to consider a purchase on this criterion alone. I think this could turn out to be something of a sleeper stock, but a lot will depend on de La Faverie’s early moves, as Weiser indicated.
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