- L’Oreal’s like-for-like sales have increased by 6.9%, which is less than the estimated 9.56%.
- Professional products saw a like-for-like sales increase of 6.4%, slightly over the estimated 5.94%.
- Consumer products like-for-like sales were up by 7.7%, but this was less than the estimated 11.1%.
- L’Oreal Luxe saw a minimal like-for-like sales increase of 0.4%, far from the estimated 4.42%.
- Dermatological beauty like-for-like sales skyrocketed by 27.3%, over the estimated 25.6%.
- North America comparable sales were up by 9.4%, more than the estimated 8.2%.
- Contrastingly, North Asia comparable sales dropped by 6.2%, a significant decrease compared to the estimated -0.07%.
- Europe’s comparable sales increased by 11.6%, which was less than the estimated 14%.
- South Asia Pacific, Middle East, North Africa, and Sub-Saharan Africa saw a comparable sales increase of 22%, higher than the estimated 19.4%.
- Latin America also saw a surge in comparable sales by 23.4%, over the estimated 21.5%.
- The total sales were EU10.61 billion, less than the estimated EU10.9 billion.
- Professional products sales were EU1.23 billion, slightly over the estimated EU1.22 billion.
- Consumer products sales were EU3.71 billion, less than the estimated EU3.89 billion.
- L’Oreal Luxe sales were EU4.14 billion, less than the estimated EU4.28 billion.
- Dermatological beauty sales were EU1.52 billion, just below the estimated EU1.53 billion.
- The operating profit for 2023 was EU8.14 billion, a 9.2% increase from the previous year, slightly less than the estimated EU8.2 billion.
- The operating margin stood at 19.8%, up from 19.5% the previous year, matching the estimate of 19.8%.
- Net income was EU6.18 billion, an increase of 8.4% from the previous year but less than the estimated EU6.32 billion.
- The adjusted EPS was EU12.08, up from EU11.26 the previous year, slightly less than the estimated EU12.15.
- The dividend per share was EU6.60, higher than the estimated EU6.45.
- The like-for-like sales increased by 11%, slightly less than the estimated 11.4%.
- The impact of currency fluctuations was -5%, more than the estimated -4.49%.
- The net impact from changes in the scope of consolidation was +1.6%, higher than the estimated +1.31%.
- L’Oreal cited a challenging environment due to geopolitical tensions, inflationary pressures, and a stagnating beauty market in China.
- The company also noted that North Asia continued to be impacted by the market softness in mainland China and the reset in Travel Retail.
L’Oreal SA on Smartkarma
Smartkarma, an independent investment research network, has recently published a pair trade analysis on L’Oreal SA, the largest beauty company in the world. The analysis, written by Steve Zhou, CFA, suggests that L’Oreal’s stock may be overvalued and recommends a bearish stance on the company. According to the report, L’Oreal has a very balanced profile in terms of geographical and category exposure, with a 15% global market share. However, the company’s stock is currently trading at a near 100% premium over the average of European consumer staples, which is a multi-decade high. This could indicate that L’Oreal’s growth may be slowing down.
Despite being excellently managed and out-performing the overall global beauty industry growth by an average of 5% over the last 3 years, L’Oreal’s high valuation has raised concerns among investors. The report highlights that the second largest beauty company in the world has only around 5% market share, further emphasizing L’Oreal’s dominant position in the industry. With a forward PE of 34x, L’Oreal’s stock may be considered expensive, leading to the bearish sentiment expressed by the report. Investors are advised to keep an eye on L’Oreal’s performance and potential slowdown in growth.
A look at L’Oreal SA Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 1 | |
| Growth | 4 | |
| Resilience | 4 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.0 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
L’Oreal SA, a company that creates and sells health and beauty products, has a positive long-term outlook according to Smartkarma’s Smart Scores. This system rates companies on a scale of 1 to 5, with a higher score indicating a better outlook. L’Oreal SA scored a 2 for Value, 1 for Dividend, and an impressive 4 for Growth, Resilience, and Momentum.
Based on Smartkarma’s ratings, L’Oreal SA has strong potential for growth in the future. The company has been able to maintain its momentum and resilience, making it a stable choice for investors. In addition, L’Oreal SA‘s products, which include cosmetics, hair care, and skin care, are in high demand among both professionals and consumers. With a focus on innovation and quality, L’Oreal SA is well-positioned to continue its success in the health and beauty industry.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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