Goldman Sachs Says This 1 Stock Is at a ‘Fundamental Inflection Point’ and You Should Buy It Now

Core Viewpoint - Goldman Sachs upgraded Estée Lauder from "Neutral" to "Buy," raising the price target to $115 from $76, indicating a belief that the company has reached a "fundamental inflection point" after previous struggles [1] Group 1: Company Strategy and Performance - Estée Lauder's "Beauty Reimagined" strategy is gaining traction, with management launching brands on Amazon across 11 divisions and TikTok, adopting a consumer-first approach to drive faster innovation [2] - The company is emerging from three consecutive years of sales declines, with a fiscal 2026 revenue growth guidance of flat to 3%, marking a turnaround after an 8% decline in fiscal 2025 [5] - CEO Stéphane de la Faverie's strategy focuses on five pillars, with consumer coverage and innovation showing the fastest progress, including the operation of 11 brand stores on Amazon's U.S. Premium Beauty platform [6] Group 2: Market Trends and Growth Catalysts - China is identified as a significant catalyst, with sales returning to mid-single-digit growth in the second half of fiscal 2025 after prolonged weakness [3] - Travel retail is rebounding, particularly in Hainan, with inventory levels improving; travel retail previously accounted for nearly a third of sales but fell to 15% in fiscal 2025 [3] - Goldman Sachs forecasts 500 basis points of EBIT margin expansion by fiscal 2028, driven by cost efficiencies and productivity gains, expecting double-digit EBIT margins by fiscal 2027 [4] Group 3: Stock Performance and Market Sentiment - Estée Lauder's stock has rallied over 80% in the past six months as market sentiment improves, with recent upgrades from HSBC, Deutsche Bank, and BofA Securities indicating growing Wall Street confidence [4]