NEW YORK (TheStreet) -- Shares of Estee Lauder Cos. (EL) are gaining, up 1.23% to $74.35 in early market trading, after the company had coverage initiated by analysts at Raymond James Financial with an "outperform" rating and a price target of $80 on shares.
The personal products company recently declared a quarterly dividend scheduled for Monday, December 15 of 24 cents a share, up from 20 cents a share in the previous quarter. This represents a 96 cent dividend on an annualized basis and a yield of 1.31%.
New York City-based Estee Lauder is a manufacturer and marketer of skin care, makeup, fragrance and hair care products, with its items selling in over 150 countries under brands including Estee Lauder, Aramis, Clinique, Origins, Le Labo, M.A.C, Bobbi Brown, La Mer and Aveda.
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Separately, TheStreet Ratings team rates LAUDER (ESTEE) COS INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate LAUDER (ESTEE) COS INC (EL) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its notable return on equity, expanding profit margins, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. When compared to other companies in the Personal Products industry and the overall market, LAUDER (ESTEE) COS INC's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
- The gross profit margin for LAUDER (ESTEE) COS INC is currently very high, coming in at 83.43%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 8.66% is above that of the industry average.
- Net operating cash flow has significantly increased by 327.09% to $127.70 million when compared to the same quarter last year. In addition, LAUDER (ESTEE) COS INC has also vastly surpassed the industry average cash flow growth rate of 26.68%.
- EL, with its decline in revenue, slightly underperformed the industry average of 5.8%. Since the same quarter one year prior, revenues slightly dropped by 1.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Despite currently having a low debt-to-equity ratio of 0.35, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.49 is sturdy.
- You can view the full analysis from the report here: EL Ratings Report