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Investing.com -- Shares of Puig climbed 3.2% as the company reported robust fourth-quarter sales, surpassing analyst expectations with a 14.1% like-for-like (LfL) growth compared to the consensus of 7.6%. The surge was primarily driven by a 21% increase in fragrance sales at a constant perimeter, which helped counterbalance the softer performances in Make-up and Skincare.
The company’s success in the fragrance sector was attributed to the popularity of Jean-Paul Gautier, particularly in the United States, and a range of niche fragrance brands like Byredo. Puig’s growth in the Americas, which saw a 16.1% rise in the fourth quarter of 2024, was further bolstered by its effective social media and marketing strategies that appealed to the Gen Z demographic in North America.
Additionally, the company’s focus on prestige and niche positioning has capitalized on the ongoing trend of premiumisation within the beauty industry. Jean-Paul Gautier’s ascent into the global top 10 brands significantly contributed to Puig’s yearly growth, while niche fragrances maintained a double-digit growth pace, as reported by management.
However, the Make-up and Skincare categories did not perform as well. Both segments were compared against a strong previous year’s quarter, which included the sell-in at Ulta and the launch of the Magic Water cream in skincare. Make-up was particularly impacted by the withdrawal of a best-selling product from Charlotte Tilbury, the Airbrush flawless setting spray, which led to a 7.6% decline in constant perimeter sales for the fourth quarter.
Despite this, Charlotte Tilbury’s sell-out figures remained strong, maintaining its position as the leading make-up brand in the UK and improving from fifth to third place in the US market.
In light of this performance, earnings per share (EPS) estimates for Puig have been adjusted upward by 1-2% for the fiscal years 2024-2026.
Bank of America analysts commented on the results, stating, "Ultimately continued execution as a publicly listed company will lead to a multiple re-rating in our view."
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