Estee Lauder (EL) Stock Forecast & Price Target

Estée Lauder Cos has demonstrated robust performance in the luxury beauty segment, particularly with double-digit growth from brands like Le Labo and a solid earnings beat attributed to improved gross margins and stringent expense management. The company has successfully initiated a profit recovery plan, achieving over 60% of its Fiscal Year 2025 targets in the first half of the year through strategic measures such as inventory reduction and cost control. Additionally, the positive organic sales growth seen in key brands and regions, including significant contributions from Clinique and the Japanese market, further supports a favorable financial outlook for the company.

Estee Lauder Cos experienced a notable decline in sales across multiple regions and categories, with organic sales in EMEA down 6% and a significant 11% decline in Asia-Pacific, particularly from key markets like Mainland China and Korea. The company is facing persistent challenges in the global travel retail sector, leading to a projected third-quarter sales decline of 10%-12% on a reported basis, exacerbated by a difficult year-over-year comparison. Furthermore, the company's FY25 EPS estimate has been revised down to $1.36 from $1.41, indicating potential ongoing financial pressures and underscoring a negative outlook for the stock.