Intel stock extends gains after report of possible U.S. government stake
Investing.com - UBS has reiterated its Neutral rating and $93.00 price target on Estee Lauder (NYSE:EL) ahead of the company’s fourth-quarter fiscal 2025 earnings report scheduled for August 20. According to InvestingPro data, analyst targets for the stock range from $56.20 to $120.00, with 7 analysts recently revising their earnings expectations upward.
Estee Lauder shares have outperformed year-to-date, gaining 23.52% compared to the Consumer Staples Select Sector SPDR Fund’s 5.1% increase and beauty/luxury peers’ 10% decline, according to UBS. The company maintains impressive gross profit margins of 73.93% and has sustained dividend payments for 30 consecutive years.
The investment firm notes that investor sentiment toward Estee Lauder has improved considerably, driven by favorable risk/reward perception and a view that the worst performance may be behind the company, suggesting that estimate revisions have bottomed.
While UBS acknowledges some signs of improvement in underlying trends, it believes the current valuation of approximately 34 times next-twelve-months earnings already reflects this optimism, representing an 18% premium versus peers compared to the long-term historical average premium in the high single digits to low double digits. InvestingPro analysis shows the stock trading at elevated multiples, with a Price/Book ratio of 7.73x and an EV/EBITDA of 18.76x, suggesting fair valuation at current levels.
Given the wide range of potential outcomes regarding consumer demand, inventory levels in key channels, and tariffs, UBS indicates it would wait for either a more attractive entry point or greater clarity on Estee Lauder’s earnings power over the next 12-18 months before considering a more positive stance. The company maintains strong liquidity with a current ratio of 1.41x and operates with moderate debt levels, while analysts project a return to profitability this fiscal year despite recent challenges.
In other recent news, Estée Lauder Companies Inc. has appointed Aude Gandon as Chief Digital & Marketing Officer, effective August 1, 2025. This newly created position will have Gandon overseeing the transformation of the company’s digital and marketing strategies. On the financial front, Citi has adjusted its price target for Estée Lauder to $95, maintaining a Neutral rating, while noting a challenging quarter with an expected 12.5% decline in organic sales growth. BofA Securities has resumed coverage with a Buy rating and a $110 price target, highlighting the company’s strong position in the global prestige beauty market. HSBC has also upgraded Estée Lauder from Hold to Buy, setting a new price target of $99, based on anticipated earnings growth driven by cost-cutting and efficiencies. Additionally, changes to the board of directors are forthcoming, as Lynn Forester de Rothschild will not seek re-election at the 2025 Annual Meeting. Her decision is not related to any disagreements with the company’s policies or practices. These developments reflect ongoing strategic shifts and financial projections for Estée Lauder.
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