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EL targets mid-single-digit organic sales growth and double-digit adjusted EPS growth through fiscal 2030.
EL aims for a 16.5-18.5% adjusted operating margin by fiscal 2030.
Innovation, cost savings and the One ELC model are expected to support profitability and cash flow.
The Estée Lauder Companies Inc. (EL - Free Report) is advancing its growth strategy through stronger consumer engagement, innovation and tighter operating discipline. Building on Beauty Reimagined and its One ELC operating model, the company aims to broaden sales growth while improving profitability and cash generation. Its approach combines sustained consumer investment with a simpler organizational structure, faster decision-making and greater efficiency to support long-term value creation.
At its Capital Markets Experience event in Shanghai, management outlined ambitions for annual mid-single-digit organic net sales growth and double-digit adjusted diluted earnings per share growth through fiscal 2030. EL aims to achieve an adjusted operating margin of 16.5-18.5% in fiscal 2030. Management said its fiscal 2027 outlook reflects accelerating organic sales growth and another year of significant profitability improvement, providing context for its longer-term ambitions.
EL’s Innovation & Efficiency Underpin the Growth Plan
To sustain sales momentum, EL plans to expand consumer reach, improve conversion and attract and retain shoppers through innovation. Continued consumer-facing investment will support brand appeal, relevance, equity and engagement. The company seeks more balanced growth across brands, product categories and geographic regions, including East and West. Its One ELC model and Reimagined Ways of Working emphasize streamlined processes, wider use of technology and automation, clearer accountability and an agile, entrepreneurial culture.
Profitability improvement rests partly on completing approved Profit Recovery and Growth Plan initiatives through fiscal 2027. Management expects greater margin expansion in fiscal 2028 than in fiscal 2029 or 2030, reflecting a full year of benefits from those initiatives. Further support should come from everyday efficiencies, incremental reductions in non-consumer-facing expenses and operational improvements in adjusted gross margin, alongside continued consumer investment.
EL aims to bring its adjusted effective tax rate to 30% or below by fiscal 2030. Higher earnings, lower restructuring payments and continued working capital efficiencies are expected to strengthen operating cash flow. Combined with optimized capital spending, these improvements should increase free cash flow through fiscal 2030. Together, the unaudited ambitions set out management’s plan to translate broader sales growth and operational improvements into stronger earnings and cash generation.
Shares of Estée Lauder have gained 20% over the past month as compared with the industry’s12.5% growth.
Image Source: Zacks Investment Research
From a valuation standpoint, EL trades at a forward price-to-sales ratio of 2.54, down from the industry’s average of 2.73. It has a Value Score of B.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Estée Lauder’s fiscal 2027 earnings implies year-over-year growth of 35.1%, whereas the same for fiscal 2028 indicates an uptick of 18.8%. The estimates for fiscal 2026 and 2027 have been revised upward by 7 cents each, respectively, over the past seven days.
Image Source: Zacks Investment Research
EL currently carries a Zacks Rank #2 (Buy).
Other Key Picks
We have highlighted three other top-ranked stocks, namely, Ulta Beauty, Inc. (ULTA - Free Report) , Bath & Body Works, Inc. (BBWI - Free Report) and BJ’s Wholesale Club Holdings, Inc. (BJ - Free Report) .
The Zacks Consensus Estimate for Ulta Beauty’s current fiscal-year earnings and sales suggests growth of 12.9% and 10.7%, respectively, from the year-ago actuals. ULTA delivered a trailing four-quarter average earnings surprise of 7.6%.
Bath & Body Works has grown into a global retailer specializing in personal care and home fragrance. BBWI currently carries a Zacks Rank #2.
The Zacks Consensus Estimate for Bath & Body Works’ current fiscal-year earnings and sales suggests decline of 14.6% and 3.5%, respectively, from the year-ago actuals. BBWI delivered a trailing four-quarter average earnings surprise of 43%.
BJ’s Wholesale Club emphasizes value through a curated assortment of groceries, fresh foods, general merchandise, gasoline, and ancillary services, supported by digital capabilities and member-focused promotions. BJ also has a Zacks Rank of 2.
The Zacks Consensus Estimate for BJ’s Wholesale Club’s current fiscal-year earnings and sales suggests growth of 6.8% and 13.3%, respectively, from the year-ago actuals. BJ delivered a trailing four-quarter average earnings surprise of 4.8%.
View the Zacks #1 Rank List
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EL's Fiscal 2030 Roadmap Targets Stronger Growth & Higher Margins
Key Takeaways
The Estée Lauder Companies Inc. (EL - Free Report) is advancing its growth strategy through stronger consumer engagement, innovation and tighter operating discipline. Building on Beauty Reimagined and its One ELC operating model, the company aims to broaden sales growth while improving profitability and cash generation. Its approach combines sustained consumer investment with a simpler organizational structure, faster decision-making and greater efficiency to support long-term value creation.
At its Capital Markets Experience event in Shanghai, management outlined ambitions for annual mid-single-digit organic net sales growth and double-digit adjusted diluted earnings per share growth through fiscal 2030. EL aims to achieve an adjusted operating margin of 16.5-18.5% in fiscal 2030. Management said its fiscal 2027 outlook reflects accelerating organic sales growth and another year of significant profitability improvement, providing context for its longer-term ambitions.
EL’s Innovation & Efficiency Underpin the Growth Plan
To sustain sales momentum, EL plans to expand consumer reach, improve conversion and attract and retain shoppers through innovation. Continued consumer-facing investment will support brand appeal, relevance, equity and engagement. The company seeks more balanced growth across brands, product categories and geographic regions, including East and West. Its One ELC model and Reimagined Ways of Working emphasize streamlined processes, wider use of technology and automation, clearer accountability and an agile, entrepreneurial culture.
Profitability improvement rests partly on completing approved Profit Recovery and Growth Plan initiatives through fiscal 2027. Management expects greater margin expansion in fiscal 2028 than in fiscal 2029 or 2030, reflecting a full year of benefits from those initiatives. Further support should come from everyday efficiencies, incremental reductions in non-consumer-facing expenses and operational improvements in adjusted gross margin, alongside continued consumer investment.
EL aims to bring its adjusted effective tax rate to 30% or below by fiscal 2030. Higher earnings, lower restructuring payments and continued working capital efficiencies are expected to strengthen operating cash flow. Combined with optimized capital spending, these improvements should increase free cash flow through fiscal 2030. Together, the unaudited ambitions set out management’s plan to translate broader sales growth and operational improvements into stronger earnings and cash generation.
Estée Lauder’s Price Performance, Valuation & Estimates
Shares of Estée Lauder have gained 20% over the past month as compared with the industry’s12.5% growth.
Image Source: Zacks Investment Research
From a valuation standpoint, EL trades at a forward price-to-sales ratio of 2.54, down from the industry’s average of 2.73. It has a Value Score of B.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Estée Lauder’s fiscal 2027 earnings implies year-over-year growth of 35.1%, whereas the same for fiscal 2028 indicates an uptick of 18.8%. The estimates for fiscal 2026 and 2027 have been revised upward by 7 cents each, respectively, over the past seven days.
Image Source: Zacks Investment Research
EL currently carries a Zacks Rank #2 (Buy).
Other Key Picks
We have highlighted three other top-ranked stocks, namely, Ulta Beauty, Inc. (ULTA - Free Report) , Bath & Body Works, Inc. (BBWI - Free Report) and BJ’s Wholesale Club Holdings, Inc. (BJ - Free Report) .
Ulta Beauty is an international specialty beauty retailer. The company flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Ulta Beauty’s current fiscal-year earnings and sales suggests growth of 12.9% and 10.7%, respectively, from the year-ago actuals. ULTA delivered a trailing four-quarter average earnings surprise of 7.6%.
Bath & Body Works has grown into a global retailer specializing in personal care and home fragrance. BBWI currently carries a Zacks Rank #2.
The Zacks Consensus Estimate for Bath & Body Works’ current fiscal-year earnings and sales suggests decline of 14.6% and 3.5%, respectively, from the year-ago actuals. BBWI delivered a trailing four-quarter average earnings surprise of 43%.
BJ’s Wholesale Club emphasizes value through a curated assortment of groceries, fresh foods, general merchandise, gasoline, and ancillary services, supported by digital capabilities and member-focused promotions. BJ also has a Zacks Rank of 2.
The Zacks Consensus Estimate for BJ’s Wholesale Club’s current fiscal-year earnings and sales suggests growth of 6.8% and 13.3%, respectively, from the year-ago actuals. BJ delivered a trailing four-quarter average earnings surprise of 4.8%.