A Fresh Look at Coty (COTY) Valuation Following $900M Bond Issuance and Strategic Overhaul

Coty, a major player in beauty and fragrances, has just completed the pricing and issuance of $900 million in senior notes. The company intends to use these funds to redeem existing debt and improve its balance sheet.

See our latest analysis for Coty.

It’s been an eventful stretch for Coty, highlighted by fresh organizational changes and the $900 million bond offering just wrapped up. Despite these moves, momentum has been under pressure, with the share price down 38.9% year-to-date and the 1-year total shareholder return falling 54.5%. Investors are watching closely to see whether Coty’s transformation plan can reignite longer-term growth.

If Coty’s refinancing plans have you thinking bigger picture, now’s a smart time to explore fast growing stocks with high insider ownership.

With Coty’s share price languishing well below analyst targets and valuation metrics flashing discounts, the critical question for investors is clear: is this the moment to buy into a turnaround, or are future gains already baked in?

Most Popular Narrative: 16.9% Undervalued

Coty’s most followed narrative places its fair value at $5.04, about 17% above the last close of $4.19. This positions Coty as an undervalued turnaround story with potential upside, according to the consensus view.

Accelerating growth in China and premiumization globally, particularly the outperformance of the Lancaster skincare brand (up 40% compared to the market) and enhanced e-commerce penetration, puts Coty in a position to capture the ongoing rise in middle class consumption and shifting beauty routines in emerging markets. This underpins both revenue and margin improvements.

Read the complete narrative.

Curious how analysts are projecting a swing from losses to profits and margin expansion over the next few years? The full narrative uncovers the assumptions behind this bullish outlook, including some surprisingly ambitious earnings targets and a turnaround in global demand. Find out what’s driving these projections and why the consensus thinks Coty could break out from current levels.

Result: Fair Value of $5.04 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, ongoing retailer destocking and heightened competition, especially in mass and prestige beauty, could continue to put pressure on Coty’s top-line and margins.

Find out about the key risks to this Coty narrative.

Build Your Own Coty Narrative

If you’d rather take a different view or want a hands-on approach, it’s quick and easy to dig into Coty’s data and craft your own perspective. Do it your way.

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Coty.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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