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The Estee Lauder Companies (EL - Free Report) is one of the world's leading manufacturers and marketers of skincare, makeup, fragrance, and hair care products. The company's products are sold through department stores, mass retailers, company-owned retail stores, hair salons, and travel-related establishments.
Analysts have taken a bearish stance on the company’s earnings outlook, landing the stock into an unfavorable Zacks Rank #5 (Strong Sell).
Image Source: Zacks Investment Research
Share Performance & Quarterly Results
EL shares have struggled to find traction over the last month, down nearly 20% and underperforming relative to the general market. As we can see by the red arrow circled in the chart below, the market had a poor reaction to EL’s latest quarterly release.
Image Source: Zacks Investment Research
In the above-mentioned release, EL posted EPS of $0.47, 4% below expectations and reflecting a 75% year-over-year pullback. Still, top line results showed some positivity, with EL beating sales expectations by roughly 1%.
It’s worth noting that the recent EPS miss broke a long-standing trend of positive earnings surprises.
Image Source: Zacks Investment Research
Valuation
EL shares may not entice value-focused investors, reflected by its Style Score of “F” for Value. Presently, Estee Lauder shares trade at a 51.2X forward earnings multiple, well above the 36.2X five-year median.
Image Source: Zacks Investment Research
The company’s forward price-to-sales ratio presently works out to be 4.5X, nearly in line with the five-year median and below the Zacks sector average.
Image Source: Zacks Investment Research
Dividends
The company rewards its shareholders, with its annual dividend currently yielding a respectable 1.3%.
Undoubtedly worth highlighting, the company has shown a commitment to increasingly rewarding investors, carrying a 12% five-year annualized dividend growth rate.
Image Source: Zacks Investment Research
Bottom Line
A recent EPS miss on the minds of investors and negative earnings estimate revisions from analysts paint a challenging picture for the company’s shares in the near term.
The Estee Lauder Companies (EL - Free Report) is a Zacks Rank #5 (Strong Sell), indicating that analysts have taken a bearish stance on the company’s earnings outlook over the last several months.
For those seeking strong stocks, a great idea would be to focus on stocks carrying a Zacks Rank #1 (Strong Buy) or a Zacks Rank #2 (Buy) – these stocks sport a notably stronger earnings outlook paired with the potential to deliver explosive gains in the near term.
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Bear of the Day: The Estee Lauder Companies (EL)
The Estee Lauder Companies (EL - Free Report) is one of the world's leading manufacturers and marketers of skincare, makeup, fragrance, and hair care products. The company's products are sold through department stores, mass retailers, company-owned retail stores, hair salons, and travel-related establishments.
Analysts have taken a bearish stance on the company’s earnings outlook, landing the stock into an unfavorable Zacks Rank #5 (Strong Sell).
Image Source: Zacks Investment Research
Share Performance & Quarterly Results
EL shares have struggled to find traction over the last month, down nearly 20% and underperforming relative to the general market. As we can see by the red arrow circled in the chart below, the market had a poor reaction to EL’s latest quarterly release.
Image Source: Zacks Investment Research
In the above-mentioned release, EL posted EPS of $0.47, 4% below expectations and reflecting a 75% year-over-year pullback. Still, top line results showed some positivity, with EL beating sales expectations by roughly 1%.
It’s worth noting that the recent EPS miss broke a long-standing trend of positive earnings surprises.
Image Source: Zacks Investment Research
Valuation
EL shares may not entice value-focused investors, reflected by its Style Score of “F” for Value. Presently, Estee Lauder shares trade at a 51.2X forward earnings multiple, well above the 36.2X five-year median.
Image Source: Zacks Investment Research
The company’s forward price-to-sales ratio presently works out to be 4.5X, nearly in line with the five-year median and below the Zacks sector average.
Image Source: Zacks Investment Research
Dividends
The company rewards its shareholders, with its annual dividend currently yielding a respectable 1.3%.
Undoubtedly worth highlighting, the company has shown a commitment to increasingly rewarding investors, carrying a 12% five-year annualized dividend growth rate.
Image Source: Zacks Investment Research
Bottom Line
A recent EPS miss on the minds of investors and negative earnings estimate revisions from analysts paint a challenging picture for the company’s shares in the near term.
The Estee Lauder Companies (EL - Free Report) is a Zacks Rank #5 (Strong Sell), indicating that analysts have taken a bearish stance on the company’s earnings outlook over the last several months.
For those seeking strong stocks, a great idea would be to focus on stocks carrying a Zacks Rank #1 (Strong Buy) or a Zacks Rank #2 (Buy) – these stocks sport a notably stronger earnings outlook paired with the potential to deliver explosive gains in the near term.