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The Estee Lauder Companies Inc
EL : NYSE : Consumer Goods
$97.13 up1.26 | 1.31%
Today's Range: 95.68 - 97.48
Avg. Daily Volume: 1,446,900
05/02/16 - 4:01 PM ET

Financial Analysis


LAUDER (ESTEE) COS INC's gross profit margin for the second quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company has grown sales and net income during the past quarter when compared with the same quarter a year ago, however, it was unable to keep up with the growth of the average competitor within its industry. LAUDER (ESTEE) COS INC has average liquidity. Currently, the Quick Ratio is 1.14 which shows that technically this company has the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has decreased by 5.61% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)3124.83044.5
EBITDA ($mil)755.2732.1
EBIT ($mil)651.0632.8
Net Income ($mil)446.2435.7


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)1414.21372.0
Total Assets ($mil)8582.17856.6
Total Debt ($mil)1981.71389.2
Equity ($mil)3603.83818.0


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin84.4984.44
EBITDA Margin24.1624.04
Operating Margin20.8320.79
Sales Turnover1.291.39
Return on Assets13.7514.44
Return on Equity32.7529.71
Debt Q2 FY16 Q2 FY15
Current Ratio1.812.17
Debt/Capital0.350.27
Interest Expense17.015.0
Interest Coverage38.2942.19


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)369.39378.84
Div / share0.30.24
EPS1.191.13
Book value / share9.7610.08
Institutional Own % n/a n/a
Avg Daily Volume1454472.01930340.0

Valuation


BUY. LAUDER (ESTEE) COS INC's P/E ratio indicates a premium compared to an average of 26.86 for the Personal Products industry and a premium compared to the S&P 500 average of 23.99. Conducting a second comparison, its price-to-book ratio of 9.96 indicates a significant premium versus the S&P 500 average of 2.74 and a premium versus the industry average of 8.89. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, LAUDER (ESTEE) COS INC proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
EL 31.13 Peers 26.86   EL 18.80 Peers 18.27

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

EL is trading at a premium to its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

EL is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
EL 27.20 Peers 20.96   EL 2.66 Peers 2.09

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

EL is trading at a significant premium to its peers.

 

Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

EL trades at a significant premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
EL 9.96 Peers 8.89   EL 6.84 Peers -8.53

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

EL is trading at a premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

EL is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
EL 3.24 Peers 2.22   EL 1.03 Peers -0.48

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

EL is trading at a significant premium to its industry.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

EL has a sales growth rate that significantly exceeds its peers.

 

 

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