Estee Lauder Cos. stock jumped by 5 percent after a renowned analyst upgraded it. The cosmetic company has taken forward-looking steps to increase growth, and this received a stock upgrade. The Thursday change from neutral to buy caused the stock to pop. CWEB analysts share their take on the cosmetic company’s stock value.
On Thursday, Bank of America Securities (BofA) changed Estee Lauder’s rating from neutral to buy. The analyst commended the company for its efforts to promote growth as it explores markets other than China. We have reported that the Chinese market is declining with weak demand across several retail sectors, from luxury goods to cosmetics to different products.
On Wednesday, Estee Lauder announced that it would sell its popular Clinique brand products on Amazon in the U.S. This is the first time they will be featured on Amazon’s Premium Beauty store.
Amazon Beauty Store has a broad reach in the U.S. Clinique is an internationally recognized brand, and the partnership is expected to increase both companies’ growth.
Estee Lauder stock has seen a 12-month decline. The new upgrade in rating from BofA analyst was green shoots for the cosmetic company that had seen a decline in the past year, losing more than 30 percent of its value.
The upgrade of BofA analysts’ buying caused the stock to pop by about 6 percent. The analyst has also increased the price target from $160 to $170 just after the announcement that products will be featured on Amazon.
CWEB analysts have been reporting on the need for retail to move to broader markets without heavy dependence on China and Southeast Asia. Estee Lauder’s foray into the American market through its trusted brand Clinique is a win for both the cosmetic company and its customers in the US.
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