NYSE:EL

Stock Analysis Report

Estée Lauder Companies

Executive Summary

The Estée Lauder Companies Inc. manufactures and markets skin care, makeup, fragrance, and hair care products.

Snowflake

Fundamentals

Outstanding track record with adequate balance sheet and pays a dividend.


Similar Companies

Share Price & News

How has Estée Lauder Companies's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0.9%

EL

1.3%

US Personal Products

2.3%

US Market


1 Year Return

49.6%

EL

20.7%

US Personal Products

5.6%

US Market

Return vs Industry: EL exceeded the US Personal Products industry which returned 20.7% over the past year.

Return vs Market: EL exceeded the US Market which returned 5.6% over the past year.


Shareholder returns

ELIndustryMarket
7 Day0.9%1.3%2.3%
30 Day0.1%-0.6%-1.0%
90 Day1.3%0.5%-0.7%
1 Year51.2%49.6%22.5%20.7%7.9%5.6%
3 Year128.3%120.0%43.0%35.7%45.6%36.3%
5 Year175.5%158.9%83.9%65.5%65.8%47.6%

Price Volatility Vs. Market

How volatile is Estée Lauder Companies's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Estée Lauder Companies undervalued compared to its fair value and its price relative to the market?

39.25x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Undervalued: EL ($192.74) is trading above our estimate of fair value ($161.93)

Significantly Undervalued: EL is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: EL is poor value based on its PE Ratio (39.2x) compared to the Personal Products industry average (18.9x).

PE vs Market: EL is poor value based on its PE Ratio (39.2x) compared to the US market (17.7x).


Price to Earnings Growth Ratio

Low PEG Ratio: EL is poor value based on its PEG Ratio (3x)


Price to Book Ratio

PB vs Industry: EL is overvalued based on its PB Ratio (15.9x) compared to the US Personal Products industry average (3.6x).


Next Steps

Future Growth

How is Estée Lauder Companies forecast to perform in the next 1 to 3 years based on estimates from 24 analysts?

13.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: EL's forecast earnings growth (13.2% per year) is above the savings rate (2.7%).

Earnings vs Market: EL's earnings (13.2% per year) are forecast to grow slower than the US market (14.5% per year).

High Growth Earnings: EL's earnings are forecast to grow, but not significantly.

Revenue vs Market: EL's revenue (6.6% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: EL's revenue (6.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: EL's Return on Equity is forecast to be very high in 3 years time (51.7%).


Next Steps

Past Performance

How has Estée Lauder Companies performed over the past 5 years?

6.8%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: EL's earnings have grown by 6.8% per year over the past 5 years.

Accelerating Growth: EL's earnings growth over the past year (61.1%) exceeds its 5-year average (6.8% per year).

Earnings vs Industry: EL earnings growth over the past year (61.1%) exceeded the Personal Products industry 21%.


Return on Equity

High ROE: EL's Return on Equity (40.7%) is considered outstanding.


Return on Assets

ROA vs Industry: EL has a higher Return on Assets than the Personal Products industry average last year.


Return on Capital Employed

ROCE Improving: EL has improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Estée Lauder Companies's financial position?


Financial Position Analysis

Short Term Liabilities: EL's short term assets ($7.2B) exceeds its short term liabilities ($4.6B)

Long Term Liabilities: EL's short term assets (7.2B) exceeds its long term liabilities (4.1B)


Debt to Equity History and Analysis

Debt Level: EL's debt to equity ratio (77.4%) is considered high

Reducing Debt: EL's debt to equity ratio has increased from 34.7% to 77.4% over the past 5 years.

Debt Coverage: EL's debt is well covered by operating cash flow (73.8%).

Interest Coverage: EL's interest payments on its debt are well covered by EBIT (34.7x coverage).


Balance Sheet

Inventory Level: EL has a high level of physical assets or inventory.

Debt Coverage by Assets: EL's debt is covered by short term assets (assets are 2.113710x debt).


Next Steps

Dividend

What is Estée Lauder Companies's current dividend yield, its reliability and sustainability?

0.89%

Current Dividend Yield


Dividend Yield vs Market

company0.9%marketbottom25%1.5%markettop25%3.8%industryaverage1.4%forecastin3Years1.1%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: EL's dividend (0.89%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.46%).

High Dividend: EL's dividend (0.89%) is low compared to the top 25% of dividend payers in the US market (3.76%).

Stable Dividend: EL's dividends per share have been stable in the past 10 years.

Growing Dividend: EL's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (34%), EL's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: EL's dividends in 3 years are forecast to be well covered by earnings (31.6% payout ratio).


Next Steps

Management

What is the CEO of Estée Lauder Companies's salary, the management and board of directors tenure and is there insider trading?

7.2yrs

Average management tenure


CEO

Fabrizio Freda (62yo)

10.3yrs

Tenure

US$21,435,428

Compensation

Mr. Fabrizio Freda has been the Chief Executive Officer and Director of The Estée Lauder Companies Inc. since July 1, 2009 and has been its President since 2008. Previously, Mr. Freda served as Chief Opera ...


CEO Compensation Analysis

Compensation vs. Market: Fabrizio's total compensation ($USD21.44M) is about average for companies of similar size in the US market ($USD11.23M).

Compensation vs Earnings: Fabrizio's compensation has been consistent with company performance over the past year.


Management Age and Tenure

7.2yrs

Average Tenure

59yo

Average Age

Experienced Management: EL's management team is seasoned and experienced (7.2 years average tenure).


Board Age and Tenure

13.4yrs

Average Tenure

68yo

Average Age

Experienced Board: EL's board of directors are seasoned and experienced ( 13.4 years average tenure).


Insider Trading

Insider Buying: EL insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$60,18305 Sep 19
Michael O'Hare
EntityIndividual
Shares300
Max PriceUS$200.61
SellUS$960,00805 Sep 19
Jane Hudis
EntityIndividual
Shares4,705
Max PriceUS$204.04
SellUS$3,091,15305 Sep 19
John Demsey
EntityIndividual
Role
Senior Key Executive
Executive Group President
Shares15,317
Max PriceUS$202.55
SellUS$3,230,45627 Aug 19
The Ronald S. Lauder Foundation, Endowment Arm
EntityCompany
Shares16,140
Max PriceUS$200.83
SellUS$1,346,57821 Aug 19
Alexandra Trower
EntityIndividual
Role
Head of Corporate Communications
Executive Vice President of Global Communications
Shares6,608
Max PriceUS$203.78
SellUS$4,649,62415 May 19
The Ronald S. Lauder Foundation, Endowment Arm
EntityCompany
Shares27,830
Max PriceUS$167.28
SellUS$822,10015 May 19
Fabrizio Freda
EntityIndividual
Role
Chief Executive Officer
President
Shares5,000
Max PriceUS$164.42
SellUS$1,512,81915 May 19
Carl Haney
EntityIndividual
Shares8,950
Max PriceUS$169.03
SellUS$4,014,72801 Mar 19
Alexandra Trower
EntityIndividual
Role
Head of Corporate Communications
Executive Vice President of Global Communications
Shares25,296
Max PriceUS$158.71
SellUS$1,942,79627 Feb 19
William Lauder
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares12,418
Max PriceUS$156.45
SellUS$66,435,56327 Feb 19
Lal Family Partners, LP
EntityCompany
Shares422,056
Max PriceUS$159.14
SellUS$232,96520 Feb 19
Irvine Hockaday
EntityIndividual
Role
Lead Director
Presiding Director
Shares1,500
Max PriceUS$155.31
SellUS$5,841,85315 Feb 19
The Ronald S. Lauder Foundation, Endowment Arm
EntityCompany
Shares38,080
Max PriceUS$153.41
SellUS$1,001,24807 Feb 19
Jane Hudis
EntityIndividual
Shares6,700
Max PriceUS$149.44
SellUS$2,027,15204 Dec 18
Tracey Travis
EntityIndividual
Role
Chief Financial Officer
Executive VP of Finance & CFO
Shares13,297
Max PriceUS$152.47
SellUS$2,140,98220 Nov 18
The Ronald S. Lauder Foundation, Endowment Arm
EntityCompany
Shares15,000
Max PriceUS$144.33
SellUS$693,34115 Nov 18
Alexandra Trower
EntityIndividual
Role
Head of Corporate Communications
Executive Vice President of Global Communications
Shares4,781
Max PriceUS$145.02
SellUS$1,618,11408 Nov 18
Sara Moss
EntityIndividual
Shares11,404
Max PriceUS$141.89
SellUS$1,053,05906 Nov 18
Tracey Travis
EntityIndividual
Role
Chief Financial Officer
Executive VP of Finance & CFO
Shares7,406
Max PriceUS$142.19

Ownership Breakdown


Management Team

  • William Lauder (59yo)

    Executive Chairman

    • Tenure: 10.3yrs
    • Compensation: US$9.52m
  • Tracey Travis (57yo)

    Executive VP of Finance & CFO

    • Tenure: 7.2yrs
    • Compensation: US$7.54m
  • Fabrizio Freda (62yo)

    President

    • Tenure: 10.3yrs
    • Compensation: US$21.44m
  • Cedric Prouve (59yo)

    Group President of International

    • Tenure: 16.8yrs
    • Compensation: US$10.23m
  • John Demsey (63yo)

    Executive Group President

    • Tenure: 3.8yrs
    • Compensation: US$9.37m
  • Rainey Mancini (49yo)

    Senior Vice President of Investor Relations

    • Tenure: 1.4yrs
  • Alexandra Trower (55yo)

    Executive Vice President of Global Communications

    • Tenure: 11.5yrs
  • Deborah Krulewitch

    Senior Vice President of Corporate Administration

    • Tenure: 0yrs
  • Georgia Garinois-Melenikiotou (59yo)

    Executive Vice President of Corporate Marketing

    • Tenure: 0yrs
  • Andrew Ross (51yo)

    Executive Vice President of Strategy & New Business Development

    • Tenure: 3.1yrs

Board Members

  • Leonard Lauder (86yo)

    Chairman Emeritus & Director

    • Tenure: 10.3yrs
    • Compensation: US$2.86m
  • William Lauder (59yo)

    Executive Chairman

    • Tenure: 10.3yrs
    • Compensation: US$9.52m
  • Ronald Lauder (75yo)

    Director

    • Tenure: 0yrs
  • Irv Hockaday (83yo)

    Presiding Director

    • Tenure: 0yrs
    • Compensation: US$320.46k
  • Rose Bravo (68yo)

    Independent Director

    • Tenure: 16.5yrs
    • Compensation: US$282.96k
  • Dick Parsons (71yo)

    Director

    • Tenure: 20.8yrs
    • Compensation: US$290.96k
  • Rich Zannino (60yo)

    Independent Director

    • Tenure: 9.8yrs
    • Compensation: US$311.96k
  • Charlene Barshefsky (68yo)

    Independent Director

    • Tenure: 18.8yrs
    • Compensation: US$327.37k
  • Fabrizio Freda (62yo)

    President

    • Tenure: 10.3yrs
    • Compensation: US$21.44m
  • Lynn De Rothschild (65yo)

    Independent Director

    • Tenure: 19.8yrs
    • Compensation: US$282.96k

Company Information

The Estée Lauder Companies Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Estée Lauder Companies Inc.
  • Ticker: EL
  • Exchange: NYSE
  • Founded: 1946
  • Industry: Personal Products
  • Sector: Household
  • Market Cap: US$69.603b
  • Shares outstanding: 361.12m
  • Website: https://www.elcompanies.com

Number of Employees


Location

  • The Estée Lauder Companies Inc.
  • 767 Fifth Avenue
  • New York
  • New York
  • 10153
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ELNYSE (New York Stock Exchange)YesClass A Common StockUSUSDNov 1995
ELAADB (Deutsche Boerse AG)YesClass A Common StockDEEURNov 1995
EL *BMV (Bolsa Mexicana de Valores)YesClass A Common StockMXMXNNov 1995
0JTMLSE (London Stock Exchange)YesClass A Common StockGBUSDNov 1995
ESLAWBAG (Wiener Boerse AG)YesClass A Common StockATEURNov 1995
ELCI34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EA REP 0.5 COM CL 'A'BRBRLMay 2019

Biography

The Estée Lauder Companies Inc. manufactures and markets skin care, makeup, fragrance, and hair care products. The company offers a range of skin care products, including moisturizers, serums, cleansers, t ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/16 23:38
End of Day Share Price2019/10/16 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.