These four poorly performing tickers are hinting at broader, bigger-picture problems that investors will want to altogether avoid.Generally speaking, when you buy a stock doesn't really matter if it's a good company and you are investing with a long-term mindset. But that doesn't mean it doesn't help your overall returns to buy a stock when it's trading at a discount. Doing so helps you get more bang for your investment buck.However, not all discounted stocks are necessarily worth buying. There's always mor ...

The skincare, makeup, and fragrance company posted weak quarterly earnings.Shares of Estée Lauder (EL -3.39%) were falling again this week, according to data from S&P Global Market Intelligence. The beauty company focused on makeup and skincare is down 23% after reporting weak earnings for the first quarter of fiscal year 2025. It is seeing demand pressure for many of its products, especially in China, and decided to slash its quarterly dividend payment.Here's why Estée Lauder stock is down big this week.We ...

Company Overview - Estée Lauder shares fell over 20% after the company withdrew its full-year earnings forecast, citing weak demand for luxury fragrance and cosmetic products [1] - The company's stock reached its lowest level in a decade at $68.03, down 22% [1] Financial Performance - Estée Lauder expects second-quarter profit per share to be between 20 cents and 35 cents, significantly below analysts' estimates of $1.06 [2] - The company anticipates net sales to decline between 6% and 8%, contrasting with Wall Street's estimate of a 0.2% growth to $4.3 billion [3] Leadership Changes - Estée Lauder appointed Stephane de la Faverie as the new CEO, effective January 1, as part of a leadership overhaul [3][9] - The company is also bringing in a new chief financial officer following the retirement announcement of longtime CFO Tracey Travis [9] Market Conditions - The beauty and luxury goods sectors are facing challenges due to reduced spending by Chinese consumers, impacted by a hiring slump, lower wages, and a weak housing market [4][6] - Estée Lauder's first-quarter sales in the Asia Pacific region fell 11%, compared to a 3% decline in the previous quarter [7] Industry Context - Other luxury brands, such as LVMH, have also reported disappointing sales, with a 5% decline in their fashion and leather goods unit, particularly in the Chinese market [8] - The company remains "cautiously optimistic" about medium- to long-term growth opportunities due to potential stimulus in China, although it does not expect immediate benefits for its second-quarter performance [6]

Core Insights - The Estee Lauder Companies Inc. (EL) experienced a significant decline in share price, dropping 24% in pre-market trading following the release of its first-quarter fiscal 2025 results, which showed a year-over-year decline in revenue and missed consensus estimates [1][2] - The company has withdrawn its fiscal 2025 outlook due to ongoing challenges in China and travel retail, indicating a cautious approach moving forward [1][4] Financial Performance - Adjusted earnings per share (EPS) were reported at 14 cents, surpassing the Zacks Consensus Estimate of 9 cents, and increased from 11 cents in the same quarter last year [2] - Quarterly net sales totaled $3,361 million, falling short of the Zacks Consensus Estimate of $3,370.9 million, representing a 4% decline year over year [2] - Organic net sales decreased by 5%, primarily due to weakened consumer sentiment in China and reduced conversion rates in Asia travel retail [3] Segment Performance - Skin Care sales decreased by 7% year over year to $1,529 million, attributed to negative consumer sentiment in China [5] - Makeup revenues fell by 2% to $1,038 million, with declines in M·A·C and Too Faced, partially offset by growth in Clinique [5] - Fragrance revenues were $630 million, down 1% from the previous year, impacted by challenges in global travel retail [6] - Hair Care sales totaled $139 million, a 6% decline year over year, reflecting softness in Aveda [6] Regional Performance - Sales in the Americas decreased by 2% to $1,187 million [7] - Revenues in the EMEA region also fell by 2% to $1,230 million [7] - The Asia-Pacific region saw a significant decline of 11%, with sales at $944 million [7] Margin and Financial Health - Gross profit was reported at $2,433 million, down 1% year over year, with a gross margin of 72.4%, an increase from 69.6% in the prior year [8] - Adjusted operating income rose by 33% to $144 million from $108 million in the previous year [8] - The company ended the quarter with cash and cash equivalents of $2,350 million, long-term debt of $7,311 million, and total equity of $5,084 million [10] Dividend and Future Outlook - The company is reducing its dividend to establish a more appropriate payout ratio, aiming for greater financial flexibility to support growth [11] - For the second quarter of fiscal 2025, reported and organic net sales are projected to decline by 6-8%, with adjusted EPS expected to drop by 60-77%, ranging from 20 cents to 35 cents [13] - Management remains cautiously optimistic about medium-to-long-term growth opportunities in China but does not expect immediate positive impacts from new economic stimulus measures [12]

Financial Data and Key Metrics Changes - For Q1 2025, organic sales decreased by 5%, primarily due to declines in mainland China, global travel retail, and Hong Kong SAR [8][34] - Adjusted gross margin expanded by over 300 basis points, and adjusted EPS was $0.14, exceeding the previous year's $0.11 [10][49] - Operating income increased by 33% to $144 million, with an operating margin expansion of 120 basis points to 4.3% [48] Business Line Data and Key Metrics Changes - Organic net sales in skin care declined by 8%, while makeup decreased by 2%, driven by declines from M·A·C and Too Faced [41][42] - Fragrance organic net sales decreased by 1%, with strong performance from luxury brands like Le Labo and Jo Malone [43][25] - The Americas saw a 1% decrease in organic net sales, with North America experiencing modest growth in retail sales [39] Market Data and Key Metrics Changes - Organic net sales in Asia Pacific decreased by 11%, mainly due to weakened consumer sentiment in mainland China [35] - EMEA region saw a 4% decline in organic net sales, largely impacted by challenges in Asia travel retail [36] - North America experienced a slowdown in prestige beauty retail sales growth, dropping from high single-digit growth to mid-single-digit growth [13] Company Strategy and Development Direction - The company is focused on a strategic reset aimed at restoring sustainable long-term organic sales growth through the Profit Recovery and Growth Plan (PRGP) [17][18] - Key priorities include enhancing skin care offerings, capitalizing on high-end fragrance growth, and leveraging winning channels [19] - The company plans to continue investing in innovation and expanding consumer reach despite current market challenges [16] Management's Comments on Operating Environment and Future Outlook - Management acknowledged greater macro headwinds for fiscal year 2025 than previously expected, particularly in China and Asia travel retail [11][14] - The company has withdrawn its fiscal year 2025 outlook due to ongoing uncertainties and is only providing guidance for Q2 [14][55] - Management remains cautiously optimistic about medium-to-long-term stabilization in China due to new economic stimulus measures [12] Other Important Information - The company announced a reduction in dividends to a more appropriate payout ratio to create financial flexibility for future growth initiatives [15][54] - A leadership transition is underway, with new appointments expected to bring fresh perspectives and strategies to navigate current challenges [30][32] Q&A Session All Questions and Answers Question: Internal reaction to worsening external circumstances - Management is evaluating additional actions related to the PRGP and has identified cost savings to offset volume pressure [70] Question: Market share expectations and regional contributions to organic growth - Management expects continued pressure from China and travel retail, with overall deceleration in other markets [78] Question: Timing and message behind the dividend cut - The dividend reduction is a proactive measure to protect cash for future investments and is not indicative of long-term growth outlook [94] Question: Qualities and skill sets sought in new leadership - New leadership should focus on brand building, agility, and understanding global market dynamics to navigate future challenges [102] Question: Opportunities to reduce CapEx and inventory health - CapEx has already been reduced, and inventory levels are healthier compared to last year, with ongoing focus on agility in planning [110] Question: Retail inventory levels in Asia Travel Retail - Inventory levels in trade have decreased, but progress is slower than expected due to market volatility [113]

The Estee Lauder Companies Inc. (NYSE:EL) Q1 2025 Earnings Conference Call October 31, 2024 9:30 AM ET Company Participants Rainey Mancini - SVP of IR Fabrizio Freda - President and CEO Tracey Travis - EVP and CFO Conference Call Participants Dara Mohsenian - Morgan Stanley Steve Powers - Deutsche Bank Lauren Lieberman - Barclays Bryan Spillane - Bank of America Merrill Lynch Rupesh Parikh - Oppenheimer Bonnie Herzog - Goldman Sachs Olivia Tong - Raymond James Operator Good morning and welcome to The Estee ...

Key TakeawaysEstée Lauder shares plunged 20% Thursday after it said sales sank because of softness in China and the Asia travel markets, and that it was cutting its dividend and withdrawing its full-year outlook.The luxury beauty products maker reported fiscal 2025 first-quarter revenue was down 4% year-over-year, and organic sales fell 5%.On Wednesday, Estée Lauder named Stephane de La Faverie its new CEO. Estée Lauder (EL) shares tanked 20% Thursday after the luxury beauty products maker warned about soft ...

The cosmetics giant is facing serious challenges in China.Shares of Estée Lauder (EL -20.83%) were taking a dive today as the cosmetics giant continued to struggle with weakness in China as the company also cut its dividend and pulled its guidance for the fiscal year, reflecting a lack of visibility into the China situation and a need to reinvest in the business.The stock was down 19.3% on the news as of 12:38 p.m. ET. Estée Lauder's challenges continueEstée Lauder, which owns brands like Aveda, Clinique, L ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ______________________________________________________________________ FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2024 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-14064 The Estée Lauder Companies Inc. ...

For the quarter ended September 2024, Estee Lauder (EL) reported revenue of $3.36 billion, down 4.5% over the same period last year. EPS came in at $0.14, compared to $0.11 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $3.37 billion, representing a surprise of -0.29%. The company delivered an EPS surprise of +55.56%, with the consensus EPS estimate being $0.09.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and ho ...