By Senad Karaahmetovic
Shares of Estee Lauder (NYSE:EL) are down by 1.5% after the beauty company offered a weaker-than-expected forecast.
EL reported an adjusted EPS of $0.42 to beat the analyst estimate of $0.32. Net sales came in at $3.56 billion, again better than the $3.43 billion consensus. However, EL reported an adjusted gross margin of 71.3%, trailing the consensus of 74.3%.
For this quarter, Estee Lauder is looking for an adjusted EPS of $1.22 to $1.32, much weaker than the estimate of $1.85. Net sales are seen decelerating by 8% to 10%, while analysts were looking for a flat growth rate.
On a full-year basis, Estee Lauder is seen between $7.39 and $7.54, compared to the estimate of $7.92. Net sales are expected to grow between 3% and 5%, lower than the consensus of +7%.
A Piper Sandler analyst said Estee’s numbers missed expectations “across the board,” which is “consistent with our sentiment into the print.”
A Goldman Sachs analyst echoed her thoughts and added:
“Investors we spoke with ahead of results expected a better 4Q and weaker outlook, but we believe lower than expected quality of the 4Q beat and weaker than expected 1Q outlook (especially at the revenue line) will cause the stock to under perform on the day.”