Evercore analyst Robert Ottenstein maintains $Estee Lauder (EL.US)$ with a buy rating, and adjusts the target price from $130 to $107.
According to TipRanks data, the analyst has a success rate of 48.0% and a total average return of -0.2% over the past year.
Furthermore, according to the comprehensive report, the opinions of $Estee Lauder (EL.US)$'s main analysts recently are as follows:
The company's Q1 performance exceeded expectations but was overshadowed by Q2 projections not meeting consensus, retracted guidance for the second half of the year, and a reduction in dividend payments. The analyst points out that current visibility is limited, expressing anticipation for potential changes in strategy and any new plans for increased productivity from the incoming executives. There is a suggestion for a more comprehensive restructuring plan to address the company's high cost structure.
The projection that Estee Lauder will maintain a dividend payout ratio close to 40%, based on the newly announced 35 cents per share quarterly dividend, suggests a net income of approximately $1.2 billion or an earnings power of $3.50 per share over time. The analyst believes that it may be too early to take advantage of the current price decline given the ongoing slowdown and uncertainty in China, and with the transition to a new CEO in January.
Persistent sales declines and limited visibility ahead, which prompted management to withdraw guidance, are of particular concern. The lack of expected visibility is anticipated to persist for at least another three months. Given the operating deleverage from lower volumes in China and Asia travel retail, the execution of plans and returns may be delayed. It is considered prudent to recommend that investors await stronger indications of demand improvement.
Note:
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