Stifel analysts think Estee Lauder Cos.’s
growth is sustainable thanks to increasing use of beauty products, “trade-up” to luxury beauty brands, and growing access to Estée Lauder merchandise, notably online in China. Estée Lauder brands include La Mer, the namesake brand, and MAC, which all grew in the most recent quarter. Geographically, China was strong. “Notably, the tensions in Hong Kong, ~4% of sales, have not had a significant effect on Estée Lauder’s business,” analysts wrote. “Management noted that it is working to recover part of the tourist revenue in other markets and to reach those consumers online, as well as reaching the local consumer through target marketing and product innovation.” Stifel rates Estée Lauder stock buy with a $210 price target, up from $205. Raymond James also raised its price target, to $216 from $181. Analysts there rate Estée Lauder stock outperform. And Wells Fargo lifted its price target to $190 from $175, with a market perform stock rating. Estée Lauder stock has gained 55.4% for the year to date while the S&P 500 index
is up 16.6% for the period.
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