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Buyouts, Online Sales to Aid Estee Lauder (EL) in Q4 Earnings
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The Estee Lauder Companies Inc. (EL - Free Report) is slated to release fourth-quarter fiscal 2018 results on Aug 20. We note that this cosmetics giant has delivered positive earnings and sales surprise for 15 and five consecutive quarters, respectively. The impressive performance can be attributed to well-chalked buyouts, strong market reach as well as a robust online and travel retail network. These upsides have been enabling the company to counter receding traffic in the U.S. brick-and-mortar stores. Let’s see if Estee Lauder’s endeavors can help it to maintain its spectacular surprise streak this time.
Online & Travel Retail Bode Well
E-commerce has been a vital revenue generating platform for Estee Lauder, considering consumers’ increasing preference for online shopping. In this respect, constant technological upgradations along with a digital-first mindset have been boosting the company’s online sales and driving the top line. During third-quarter fiscal 2018, online sales were strong, with exceptionally robust performance in China. Also, the company’s retail dot-com sales jumped double-digits in all regions. Apart from Estee Lauder, other cosmetics players like Helen of Troy (HELE - Free Report) have been gaining from such e-commerce trends. Going ahead, the company continues to expect online sales to contribute to revenues.
Lately, Estee Lauder has been witnessing exceptional growth in travel retail. In particular, the fragrance category has been boosting travel retail. Additionally, the company’s investments in key markets, especially Asia, has been yielding. Well, the company is committed toward its efforts to enhance conversions through strategic initiatives such as better customer insights, enhanced merchandising and improved digital marketing.
The Estee Lauder Companies Inc. Price, Consensus and EPS Surprise
Buyouts have been enhancing Estee Lauder’s portfolio and facilitating a strong business network. Notably, the acquisitions of BECCA and Too Faced have been strengthening the company’s fastest-growing prestige portfolio and contributed nearly 2 percentage points to sales during fiscal 2018. Estee Lauder’s investment in DECIEM — a fast-growing multi-brand company — is likely to aid beauty sales in the forthcoming periods. The company’s previous moves in this regard include the buyout of By Kilian, RODIN olio lusso and GLAMGLOW.
Forecasts Unveil a Bright Picture
The aforementioned strategic efforts along with a strong brand portfolio, presence across vital markets and expected gains from tax reforms boost optimism regarding the upcoming quarterly announcement. Moreover, management expects growth opportunities in the global prestige beauty industry, which is anticipated to grow 6-7% in fiscal 2018. This is likely to drive fiscal fourth-quarter results.
Incidentally, management expects sales to grow approximately 8-9% (in constant currency) for the impending quarter. The Zacks Consensus Estimate for revenues is pegged at $3,260 million, depicting a rise of 12.6% from the prior-year quarter's level.
Additionally, management expects earnings in the fourth quarter in the range of 48-52 cents, including a 7 cents benefit from currency. The Zacks Consensus Estimate for earnings is currently pegged at 56 cents, reflecting a 9.8% increase from the year-ago quarter’s tally.
Efforts Likely to Offset Hurdles
Estee Lauder is cautious about a difficult brick-and-mortar retail environment in the United States and in the U.K. Also, Bon-Ton’s liquidation can dent Estee Lauder’s performance to an extent. Apart from this, stiff competition and availability of cheaper alternatives may hinder performance.
Nevertheless, we expect Estee Lauder to tide over such deterrents, supported by robust demand for world-class products across several markets and platforms. All said, lets now finally take a look at what the Zacks Model unveils regarding Estee Lauder’s performance in the to-be-reported quarter.
Zacks Model
Our proven model shows that Estee Lauder is likely to beat estimates this quarter. A stock needs to have a positive Earnings ESP and a Zacks Rank #1(Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. You can see the complete list of today’s Zacks #1 Rank stocks here.
Estee Lauder has an Earnings ESP of +0.67% and has a Zacks Rank #3 that makes us reasonably confident of an earnings beat. You may uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks With Favorable Combinations
Here are some other companies, which according to our model, have the right combination of elements to deliver earnings beat.
B&G Foods, Inc (BGS - Free Report) has an Earnings ESP of +8.79% and a Zacks Rank #3.
McCormick & Company, Incorporated (MKC - Free Report) has an Earnings ESP of +0.99% and a Zacks Rank #3.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Image: Bigstock
Buyouts, Online Sales to Aid Estee Lauder (EL) in Q4 Earnings
The Estee Lauder Companies Inc. (EL - Free Report) is slated to release fourth-quarter fiscal 2018 results on Aug 20. We note that this cosmetics giant has delivered positive earnings and sales surprise for 15 and five consecutive quarters, respectively. The impressive performance can be attributed to well-chalked buyouts, strong market reach as well as a robust online and travel retail network. These upsides have been enabling the company to counter receding traffic in the U.S. brick-and-mortar stores. Let’s see if Estee Lauder’s endeavors can help it to maintain its spectacular surprise streak this time.
Online & Travel Retail Bode Well
E-commerce has been a vital revenue generating platform for Estee Lauder, considering consumers’ increasing preference for online shopping. In this respect, constant technological upgradations along with a digital-first mindset have been boosting the company’s online sales and driving the top line. During third-quarter fiscal 2018, online sales were strong, with exceptionally robust performance in China. Also, the company’s retail dot-com sales jumped double-digits in all regions. Apart from Estee Lauder, other cosmetics players like Helen of Troy (HELE - Free Report) have been gaining from such e-commerce trends. Going ahead, the company continues to expect online sales to contribute to revenues.
Lately, Estee Lauder has been witnessing exceptional growth in travel retail. In particular, the fragrance category has been boosting travel retail. Additionally, the company’s investments in key markets, especially Asia, has been yielding. Well, the company is committed toward its efforts to enhance conversions through strategic initiatives such as better customer insights, enhanced merchandising and improved digital marketing.
The Estee Lauder Companies Inc. Price, Consensus and EPS Surprise
The Estee Lauder Companies Inc. Price, Consensus and EPS Surprise | The Estee Lauder Companies Inc. Quote
Lucrative Acquisitions
Buyouts have been enhancing Estee Lauder’s portfolio and facilitating a strong business network. Notably, the acquisitions of BECCA and Too Faced have been strengthening the company’s fastest-growing prestige portfolio and contributed nearly 2 percentage points to sales during fiscal 2018. Estee Lauder’s investment in DECIEM — a fast-growing multi-brand company — is likely to aid beauty sales in the forthcoming periods. The company’s previous moves in this regard include the buyout of By Kilian, RODIN olio lusso and GLAMGLOW.
Forecasts Unveil a Bright Picture
The aforementioned strategic efforts along with a strong brand portfolio, presence across vital markets and expected gains from tax reforms boost optimism regarding the upcoming quarterly announcement. Moreover, management expects growth opportunities in the global prestige beauty industry, which is anticipated to grow 6-7% in fiscal 2018. This is likely to drive fiscal fourth-quarter results.
Incidentally, management expects sales to grow approximately 8-9% (in constant currency) for the impending quarter. The Zacks Consensus Estimate for revenues is pegged at $3,260 million, depicting a rise of 12.6% from the prior-year quarter's level.
Additionally, management expects earnings in the fourth quarter in the range of 48-52 cents, including a 7 cents benefit from currency. The Zacks Consensus Estimate for earnings is currently pegged at 56 cents, reflecting a 9.8% increase from the year-ago quarter’s tally.
Efforts Likely to Offset Hurdles
Estee Lauder is cautious about a difficult brick-and-mortar retail environment in the United States and in the U.K. Also, Bon-Ton’s liquidation can dent Estee Lauder’s performance to an extent. Apart from this, stiff competition and availability of cheaper alternatives may hinder performance.
Nevertheless, we expect Estee Lauder to tide over such deterrents, supported by robust demand for world-class products across several markets and platforms. All said, lets now finally take a look at what the Zacks Model unveils regarding Estee Lauder’s performance in the to-be-reported quarter.
Zacks Model
Our proven model shows that Estee Lauder is likely to beat estimates this quarter. A stock needs to have a positive Earnings ESP and a Zacks Rank #1(Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. You can see the complete list of today’s Zacks #1 Rank stocks here.
Estee Lauder has an Earnings ESP of +0.67% and has a Zacks Rank #3 that makes us reasonably confident of an earnings beat. You may uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks With Favorable Combinations
Here are some other companies, which according to our model, have the right combination of elements to deliver earnings beat.
B&G Foods, Inc (BGS - Free Report) has an Earnings ESP of +8.79% and a Zacks Rank #3.
McCormick & Company, Incorporated (MKC - Free Report) has an Earnings ESP of +0.99% and a Zacks Rank #3.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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