Coty (COTY): Assessing Valuation After Analyst Cuts and Earnings Misses Spark Cautious Sentiment

Wall Street is keeping a close eye on Coty (COTY) as the company prepares to report results for the September 2025 quarter. Investors are reacting to expectations for flat earnings and lower revenues. Sentiment is turning cautious after analysts revised forecasts lower this past month.

See our latest analysis for Coty.

After a challenging stretch marked by several earnings misses and cautious analyst outlooks, Coty’s share price has reflected this uncertainty. The stock is now trading at $3.97, with a year-to-date share price return of -42.13% and a one-year total shareholder return of -46.93%. Recent price movement shows momentum has faded, and investors are weighing whether Coty’s fundamentals can spark a turnaround or if more pain could be ahead.

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With Coty’s shares now trading at a steep discount to analyst price targets, investors are left to consider whether the market is undervaluing future potential or if persistent challenges have already been fully priced in.

Most Popular Narrative: 21.3% Undervalued

With Coty’s last close at $3.97 and the narrative fair value set at $5.04, there is a considerable gap the market has not yet bridged. The story points to optimism ahead if Coty can deliver on a handful of tough but potentially transformative business drivers.

Innovation-led launches, including blockbusters such as HUGO BOSS Bottled Beyond, additional high-profile fragrance releases, and an aggressive expansion into the rapidly growing body and perfume mist category, are set to benefit from the surging demand for prestige scenting products across diverse demographics. This is expected to support revenue gains and sustain high profitability.

Read the complete narrative.

Want to know what is fueling this bold upside? The valuation hinges on Coty delivering on new launches, realigning growth, and hitting ambitious profit milestones. Intrigued which financial and strategic bets this outlook depends on? There is more beneath the headline—see the narrative’s surprising assumptions that justify the gap between price and fair value.

Result: Fair Value of $5.04 (UNDERVALUED)

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

However, sustained inventory destocking or ongoing weakness in Coty’s consumer beauty categories could easily derail the current positive narrative and delay a recovery.

Find out about the key risks to this Coty narrative.

Build Your Own Coty Narrative

If you think there’s a different story to tell or want a fresh perspective from your own research, you can build your own view in just minutes. 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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