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Investing.com - RBC Capital has lowered its price target on Coty Inc . (NYSE:COTY) to $10.00 from $12.00 while maintaining an Outperform rating on the stock. The beauty company’s shares, currently trading at $3.81, are near their 52-week low of $3.75, with InvestingPro data indicating the stock is currently undervalued.
The firm noted that Coty’s results were largely in line with consensus expectations, but cited underwhelming guidance for the first half of fiscal year 2026 as a factor in the price target reduction.
RBC Capital acknowledged that pressure on Coty’s performance in the first half of 2026 was anticipated, though the absence of full-year guidance may have disappointed investors.
Despite the near-term challenges, RBC believes Coty shares are undervalued at current trading levels, which are similar to 2020 when CEO Sue Nabi took the helm.
The firm emphasized that Coty’s fundamentals have "vastly been improved since 2020," which it believes warrants a higher valuation despite current market dynamics.
In other recent news, Coty Inc. reported its fourth-quarter 2025 earnings, revealing a significant miss on earnings per share (EPS) expectations. The company posted an EPS of -$0.05, falling short of the anticipated $0.02, which marked a substantial negative surprise of 350%. However, Coty’s revenue reached $1.25 billion, surpassing the forecasted $1.21 billion by 3.31%. BofA Securities responded by lowering its price target for Coty to $3.50 from $4.00, maintaining an Underperform rating due to weaker-than-expected results. The beauty company’s performance was impacted by declines in both the U.S. prestige and mass beauty markets, with prestige revenues remaining flat despite market growth. Additionally, Jefferies downgraded Coty’s stock from Buy to Hold, reducing its price target to $4.00 from $6.00. This downgrade was influenced by Coty’s plans to reduce investment in its mass cosmetics segment, which Jefferies believes could exacerbate the division’s decline. These recent developments reflect ongoing challenges for Coty in maintaining its market position.
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